2011 BCSECCOM 482

Background
1. JV Raleigh Superior Holdings Inc. (JV Raleigh) is a British Columbia company with a registered office in Vancouver, British Columbia.

2. Maisie Smith, aka Maizie Smith (Smith), is a resident of Langley, British Columbia.

3. Ingram Jeffrey Eshun (Eshun) is a resident of Ontario.

4. Eshun and Smith each owned 50% of JV Raleigh and were its only directors.

Illegal Trading and Distribution of Securities
5. JV Raleigh, Smith and Eshun have never been registered to trade securities under the Act.

6. JV Raleigh has not filed a prospectus under the Act.

7. Between July 2006 and January 2009, JV Raleigh entered into loan agreements (the Loan Agreements) raising approximately $5,700,000.00.

8. Under the Loan Agreements, JV Raleigh was to:

(a) borrow money from investors;


(b) use investor money to purchase “consumer secured notes receivable which JV Raleigh described as “a form of factoring” with typically “high yields.”

(c) provide investors a monthly “Return of Capital” payment; and

(d) return the balance of the investment, plus interest, at a later date.

9. The Loan Agreements are securities as defined in section 1 of the Act.

10. Smith:

(a) met with investors in British Columbia and assisted them in entering into the Loan Agreements;

(b) explained the Loan Agreements to investors;

(c) signed Loan Agreements on behalf of JV Raleigh;

(d) opened bank accounts in British Columbia where investor funds were deposited (the Accounts); and

(e) was an authorized signatory on the Accounts.

11. Eshun:

(a) opened the Accounts with Smith; and

(b) was an authorized signatory on the Accounts.

12. By engaging in the conduct outlined above, the JV Raleigh, Smith and Eshun traded and distributed securities contrary to sections 34 and 61 of the Act.

13. Smith and Eshun, as the sole directors of JV Raleigh authorized, permitted or acquiesced in JV Raleigh’s contraventions of sections 34 and 61 of the Act, and therefore contravened the same provisions under section 168.2 of the Act.