News Release

Vancouver – The executive director of the British Columbia Securities Commission has issued a notice of hearing alleging that four individuals breached securities laws when they proposed to execute trades for British Columbia residents in exchange for payment as part of an advance fee scheme.
 
The notice of hearing alleges that James Dupree (Dupree), Ian T. Ball (Ball), Stephen Armitage (Armitage) and Peter B. Thompson (Thompson) attempted to carry out an advanced fee scheme involving two B.C. shareholders of York-Rio Resources Inc. The four men claimed to be representatives of Douglas Charles, a purported offshore investment firm with offices in Switzerland and Panama. Orders are also being sought against Douglas Charles.

The notice of hearing also states that the Douglas Charles website consists almost entirely of text plagiarized from websites of other established financial services firms. For example, text was taken from a B.C.-based investment dealer, an investment dealer owned by a Canadian chartered bank, a wealth management firm based in Manitoba, a Japan-based securities dealer, and two broker dealers based in the U.S.

Furthermore, the Panamanian address given on the website as the head office location for Douglas Charles is actually that of a virtual office services company with which Douglas Charles has had a contract since January, 2010.

The notice also alleges that:

• In January of 2011, Dupree contacted a British Columbia shareholder of York-Rio Resources and arranged a phone call between the shareholder and Ball, a Senior Vice President of the Wealth Management and Taxation department of Douglas Charles.
• During the phone call, Ball told the shareholder that he represented an investor who was interested in trading York-Rio shares for shares in Apple, Inc. in order to show a loss in his portfolio.
• Under the terms proposed by Ball, the shareholder would need to send $9,000 to Douglas Charles to make up the difference in share price between the York-Rio shares and the Apple shares.
• On January 17, 2011, Ball sent the shareholder an email that included a document summarizing the transaction described above.
• On February 28, 2011, a representative of Douglas Charles contacted a second British Columbia shareholder of York-Rio by phone and made a similar offer. The second shareholder later received documents via email from Thompson, confirming the offer discussed on the phone.

In addition to the allegations concerning the attempted advance fee scheme, the BCSC is also alleging that Dupree, Ball, Armitage and Thompson engaged in trading securities without being registered in British Columbia.

These allegations have not been proven. Counsel for the executive director will apply to set dates for a hearing into the allegations before a panel of commissioners on June 14, 2011.

The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities within the province. You may view the notice of hearing on our website, www.bcsc.bc.ca, by typing Douglas Charles, James Dupree, Ian T. Ball, Stephen Armitage or Peter B. Thompson in the search box, or 2011 BCSECCOM 230.  Information regarding disciplinary proceedings can be found in the Enforcement section of the BCSC website.

Please visit the Canadian Securities Administrators’ Disciplined Persons List for information relating to persons disciplined by provincial securities regulators, the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association (MFDA).

If you have questions, contact Richard Gilhooley, media relations, 604-899-6713. For public inquiries, call 604 899 6854 or 1 800 373 6393 (toll free).

Learn how to protect yourself and become a more informed investor at www.investright.org