The Ontario Securities Commission has accused Khaldoun Kader, a former director of finance and treasury at Imax Corp., of insider trading and lying to investigators.

The OSC alleges that Kader directed the purchase of 110,000 shares of Imax for US$607,527.96 though an account in his mother’s name. These purchases allegedly took place between Oct. 18 and Oct. 27, 2004.

OSC staff says Kader knew when the shares were bought that the company would report better-than-expected results.

On Oct. 28, 2004, Imax reported third-quarter income from continuing operations of US4¢ a share. That was quadruple what analysts had been expecting. The company’s stock rose almost 17% in one day.

In its statement of allegations, the OSC said Kader then directed the sale of all 110,000 shares in the next few days, making a profit of almost US$90,000.

The OSC also said Kader told its investigators “that he was unaware of the account and the trading in it. He also told staff that, at the time of the trading, he was not aware of any undisclosed material facts.”

The OSC said a hearing will be held May 16 to approve a tentative settlement of the allegations. Until the settlement is approved, its details will not be released.