After years of wrangling and deal making, the Ontario Securities Commission (OSC) has permanently banned Jose Castaneda from buying or selling securities.
The OSC announced late yesterday that a settlement agreement had been reached with Castaneda, who began a two-years less a day prison sentence for his violations on January 18.
In the agreement, Castaneda admitted that for two years beginning in 1996, as a trader and account executive at Koman Investment Inc., he was trading in securities without being registered. Castaneda was issued a cease trade order for these infractions and ultimately settled with the OSC in May 2000.
However, between 1999 and 2003, Castaneda continued to trade without a license despite the cease trade order and the terms of the 2000 settlement agreement.
It was during this time, according to yesterday’s agreement, that Castaneda entered into joint venture profit-sharing agreements with a series of people who allowed him to use his discretion (and their money) for “speculative short term trading of currency forward or spot contracts.” According to the OSC agreement, Castaneda “improperly traded in both foreign currencies and commodity futures for his clients.”
The agreement lays our a series of agreed upon facts that describe various dealings that Castaneda had with these individuals—who were not told about the cease trade order against their trader. The investors lost significant amounts of money.
In addition to the prison sentence handed down in January, the Ontario Court of Justice also ordered Castaneda to pay these clients a total of $848,5000 in restitution.
Yesterday’s settlement agreement between the OSC and Castaneda means the jailed trader is permanently banned from buying or selling securities in the province. As well, he is forever barred from acting as a director or officer of any publicly traded company.