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Commission rules Exchange panel erred in decision to dismiss allegation

  • Date:

    2007-07-31

  • Number:

    2007/57

Vancouver - A British Columbia Securities Commission panel has reversed a finding of a disciplinary panel of the Canadian Venture Exchange (now the TSX Venture Exchange) in connection with a settlement between Global Securities Corporation and the Exchange.

In 2003, a disciplinary panel of the Exchange dismissed an allegation that Global failed to diligently supervise an options trading account, contrary to Exchange rules.  The Exchange appealed that finding to the commission, but Global and the Exchange reached a settlement.  In the settlement, Global admitted that it failed to diligently supervise the account and agreed to pay a $10,000 fine to the Exchange. 

In a joint submission to the commission, Global and the Exchange argued that the Exchange panel erred in law and overlooked material evidence.  The commission panel agreed and reversed the Exchange decision, finding that Global failed to diligently supervise the account, contrary to Exchange rules.

The commission panel also varied the Exchange panel decision by ordering Global to pay the TSX Venture Exchange an administrative penalty of $10,000.

"The proposed penalty is below the range of penalty we would ordinarily impose in these circumstances," the panel said in its decision. "However, . . . the difference between the proposed penalty and that which would likely result from a full hearing in the matter does not justify the time and cost that would be incurred in connection with holding that hearing.  It therefore makes sense to accept the proposed penalty."    

"The settlement is also an expeditious means of putting Global's admission on the record, and clearing up the Exchange panel's misinterpretation of head office supervision responsibilities," the panel concluded.

The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities within the province. You may view the decision on our website www.bcsc.bc.ca by typing in the search box, Global Securities Corporation or 2007 BCSECCOM 445. If you have questions, contact Ken Gracey, Media Relations, 604-899-6577.