The Ontario Securities Commission (OSC) has banned an Alberta man from the securities markets for life, following a similar sanction from the Alberta Securities Commission (ASC), which found that he defrauded investors in that province.
The OSC Monday issued an order permanently banning Nicholas David Reeves from trading, apart from for his own portfolio; banning him from becoming registered, and from serving as a director or officer of an issuer, fund manager, or registered firm.
The order reciprocates a penalty that was imposed by the ASC in 2011, following a finding that Reeves perpetrated a fraud on investors, illegally distributed securities, and made a misrepresentation to at least one investor, in Alberta.
ASC finds venture capital specialist perpetrated a fraud
In addition to the various bans from the securities markets, the ASC panel also ordered Reeves to pay an administrative penalty of $650,000 and $14,000 towards the costs of the investigation and hearing.
The ASC panel found that Reeves, who was never registered and ran an unregistered small cap investment fund, converted at least $500,000 of investor money that was intended for investment for his own use. It noted that, “Reeves engaged in the most serious of securities regulatory misconduct – fraud. Reeves lied to investors, misappropriated their money intended to be invested as venture capital in start-up entities and converted that money to his own use.”
According to the OSC order, Reeves did not appear to defend himself at its hearing. It notes that the ASC decision indicates that there is evidence showing that Reeves solicited investment and sold securities on several occasions to at least one investor who was an Ontario resident.