Salmon Arm man fined $130K for lying to investors | iNFOnews | Thompson-Okanagan's News Source

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Salmon Arm man fined $130K for lying to investors

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A Salmon Arm man has been fined $130,000 for making false and misleading statements that lost investors, many of whom were elderly, the majority of their money.

The British Columbia Securities Commission fined Donald Bergman $130,000 and barred him from certain financial work for 15 years according to a media release issued Jan. 31.

Bergman's company, All Canadian Investment Corporation, was also permanently banned from trading or purchasing any securities or derivatives.

In justifying its punishment, the Securities Commission says it must take into account the "ongoing risk" Bergman poses to the public "demonstrated by his misconduct."

The Securities Commission says that All Canadian Investment Corporation provided loans secured by mortgages on real estate properties and raised $1.6 million from 56 investors in 2014 and 2015 through three offering memorandums that explained how the loans would be secured.

READ MORE: Kelowna man ordered to pay $70K to the B.C. Securities Commission for using investor funds

"Dividends to (All Canadian Investment Corporation) investors dwindled in 2015 and stopped altogether in early 2017. The company has been in the process of liquidation under a court-appointed monitor ever since," the release says. "Losses for investors, many of whom are elderly, are estimated to be between 82 per cent and 96 per cent."

In July 2021, the Securities Commission found that Bergman and his company made "false or misleading statements" in the offering memorandums because some of the loans were not secured as promised.

Bergman and his company also made misrepresentations to investors.

"While these losses cannot be attributed solely to the misrepresentations, it was clear that (All Canadian Investment Corporation) failure to register certain of its mortgages impacted the financial recovery of its mortgage investments," the Securities Commission panel says.

Bergman had previously been registered to engage in various financial activities so "should have made him aware of the requirements of the Act and the importance to investors of accurate and complete disclosure in making investment decisions and the effect of a failure to do so on investor confidence necessary for fair and efficient markets."

Along with the $130,000 fine, he is also banned for 15 years from trading or purchasing any securities or derivatives, except in accounts in his own name, becoming or acting as a registrant or promoter, advising or otherwise acting in a management or consultative capacity in connection with activities in the securities or derivatives markets, engaging in promotional activities, and relying on any exemptions set out in the Act, the regulations or a decision.

To contact a reporter for this story, email Ben Bulmer or call (250) 309-5230 or email the editor. You can also submit photos, videos or news tips to the newsroom and be entered to win a monthly prize draw.

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