Securities regulators in B.C. are alleging that a company, which claimed to be a Chicago-based investment firm, actually defrauded investors and traded securities without being registered.
In a notice of hearing, the British Columbia Securities Commission (BCSC) alleges that representatives from a company known as Strategic Global Investments (SGI) cold-called three B.C. residents in the summer of 2012, and convinced them to invest in gold options. It reports that the three investors lost a total of $80,000 as a result of their investments with SGI.
The commission says that while SGI claims to be in the business of foreign exchange and commodities trading, the company has never been registered to trade securities in B.C. Moreover, it alleges that the company made a series of false claims on its website, including that it has been in business since 1998 and has clients in over 70 countries; that it has a head office in Chicago; and, that investors remain in control of their money at all times.
In fact, the BCSC charges that SGI’s website was not created until June 2012, that its so-called head office actually belongs to a virtual office company, and that investors have not been able to recover any money from SGI.
BCSC staff allege that “by making false claims on its website and making false statements to investors, SGI perpetrated a fraud. Additionally, by soliciting trades without being registered, SGI breached securities laws regarding registration requirements.”
The allegations have not been proven. The BCSC will apply to set dates for a hearing into the allegations before a panel of commissioners on September 3, it says.