BCSC

Notices of Hearing & Temporary Orders

RAMPART SECURITIES INC. [Temporary Order and Notice of Hearing]

BCSECCOM #: 2001 BCSECCOM 854	Document Type: Temporary Order and Notice of Hearing
Published Date: 2001-08-23	Effective Date: 2001-08-17
Details:

2001 BCSECCOM 854

IN THE MATTER OF THE SECURITIES ACT
R.S.B.C 1996, C. 418

AND

RAMPART SECURITIES INC.

Temporary Order and Notice of Hearing Under Section 161

[para 1]
1. A hearing (the “Hearing”) will be held to give Rampart Securities Inc. (“Rampart”) an opportunity to be heard before the British Columbia Securities Commission (the “Commission”) considers whether it is in the public interest to make the following orders:

1.1 under section 161(1)(f) of the Securities Act, R.S.B.C. 1996, c. 418 (the “Act”) that Rampart’s registration be suspended, cancelled or restricted or that conditions be imposed on Rampart.

[para 2]
2. The Commission will be asked to consider the following facts and allegations in making its determinations:
2.1 Rampart is registered under the Act as a broker and investment dealer and is a member of the Investment Dealers Association of Canada (the “IDA”).

The IDA Orders
2.2 On August 14, 2001, the Chair of the District Council of the IDA made an order immediately suspending the rights and privileges of membership of Rampart, and ordered Rampart to immediately cease dealing with the public pursuant to IDA By-law 20.33 because Rampart has a capital deficiency in that it failed to maintain risk-adjusted capital greater than zero as at August 14, 2001, contrary to the requirements set out in IDA By-law 17 (the “IDA Order”).

2.3 On August 16, 2001 the IDA and Rampart agreed to put a monitor in place to oversee the orderly transfer of accounts and transactions (the “Monitor”)

2.4 On August 16, 2001 the IDA Order was modified to permit the Monitor to deal with the public pursuant to the terms of the agreement between the IDA and the Rampart.

The OSC Orders
2.5 On August 15, 2001, the Ontario Securities Commission (the “Ontario Commission”) ordered that Rampart’s registration be suspended, that Rampart cease trading securities and that Rampart retain all funds, securities and property on deposit or under its control (the “OSC Freeze Order”) (collectively the “OSC Orders”)

2.6 On August 16, 2001, the Ontario Commission amended the OSC Freeze Order to permit certain transactions approved by the Monitor and further permitted transactions where securities are required to be liquidated to be transferred to another IDA Member firm to conduct the trade pursuant to the agreement between the Monitor, the IDA and Rampart.

The ASC Orders
2.7 On August 15, 2001, the Alberta Securities Commission issued an interim order under section 21 of the Alberta Securities Act that the registration of Rampart be suspended and that trading in securities by Rampart shall cease.

2.8 It appears that Rampart is in breach of section 23(1) of the Securities Rules, B.C. Reg. 194/97 (the “Rules”) that requires Rampart to maintain positive risk-adjusted capital at all times.

[para 3]
3. The Executive Director considers the length of time to hold a hearing under section 161(1) of the Act could be prejudicial to the public interest.

[para 4]
4. The Executive Director, considering that it would be in the public interest to do so, orders under section 161(2) of the Act (the “Temporary Order”) that:

4.1 the registration of Rampart is suspended; and

4.2 trading in any securities by Rampart shall cease except that the following transactions pertaining to funds, securities or property which Rampart may have on deposit, under its control or for safekeeping are exempted from this order and may be entered into and completed by Rampart;

4.2.1 transactions approved by the Monitor appointed pursuant to an agreement entered into by Rampart, the Monitor and the IDA dated August 16, 2001; and

4.2.2 transactions where securities are required to be liquidated, the securities or security positions are transferred to another Member firm of the IDA to conduct the trade, and the proceeds of the aforesaid transaction(s) are subject to the terms of the Monitor agreement set out in paragraph 4.2.1.

for a period ending on August 29, 2001.

[para 5]
5. The Hearing will be held at the 12th Floor Hearing Room, 701 West Georgia Street, Vancouver, B.C., on Wednesday, August 29, 2001, at 10:00 a.m.

[para 6]
6. At the Hearing the staff of the Commission will bring the following applications:

6.1 that the matter be adjourned for 60 days to permit the conclusion of the investigation in this matter; and

6.2 that the Temporary Order be extended until such time as the Hearing is completed and a decision rendered.

[para 7]
7. Rampart may be represented by counsel at the Hearing and may make representations and lead evidence. Rampart is requested to advise the Commission of their intention to attend by contacting the Secretary to the Commission at PO Box 10142, 9th Floor, 701 West Georgia Street, Vancouver, BC, telephone: (604) 899-6500; email: commsec@bcsc.bc.ca.

[para 8]
8. Determinations may be made in this matter if Rampart or their counsel do not appear at the Hearing.

[para 9]
DATED on August 17, 2001.

Steve Wilson
Executive Director