Securities regulators in British Columbia are accusing two men, including a former mutual fund dealer rep, of carrying out illegal distributions.
The B.C. Securities Commission (BCSC) Monday issued a notice of hearing, which alleges that Jeffrey Karl Wiegel, Michael Jerome Knight, and four real estate development companies illegally traded and distributed securities. It also alleges that the pair committed fraud, and that Knight breached a BCSC order. The allegations have not been proven.
In a notice of hearing, BCSC staff allege that Wiegel and Knight illegally raised approximately $4 million in two separate distributions; that they also illegally issued a security in the form of a promissory note; and, falsely claimed that a promissory note would be secured by a mortgage.
It also charges that Knight breached a BCSC order from 2004 that prohibited him from engaging in acts in furtherance of a trade, or in investor relation activities, for three years (the alleged violations are said to have taken place between October 2006 and August 2010). He was banned, along with two other former mutual fund salespeople, as part of settlement agreements, after they admitted to selling securities without registration or a prospectus.
The BCSC says that Knight, who was a mutual funds registrant between 1992 and 1994, was not registered when the latest violations allegedly took place. It also says that Wiegel, who was an officer and director of the four companies named in the notice, has never been registered to sell securities in B.C., and that none of the companies has ever filed a prospectus in B.C.