News Release

Vancouver - A British Columbia Securities Commission panel has fined and suspended a securities broker who contravened rules of the Investment Dealers Association of Canada and the Securities Act.

The commission panel ordered Edward Bernard Johnson, a B.C. securities broker, to pay a $68,000 administrative penalty and serve a suspension for allowing a third party to trade in the account of a client without proper authorization, and for misleading commission investigators. Johnson's suspension will begin Sept. 1, 2007 and will end on Nov. 1, 2007 (unless Johnson has not paid the administrative penalty, in which case it will end when he pays the penalty).  After the suspension ends, Johnson will be subject to six months of close supervision by his employer firm.

Johnson admitted that between April 2000 and September 2004, he contravened IDA rules when he allowed Stanley Steven Ross to trade in a client's account without proper authorization.  Ross, who was under a commission order prohibiting him from trading securities, instructed Johnson in connection with about 400 of the 450 trades in the account. Johnson executed the trades, even though he did not have the account holder's authority to accept instructions from Ross.

Noting that the evidence did not show that Johnson knew that Ross was banned from trading, the panel said that had Johnson followed IDA rules, he would have discovered that fact and could have avoided executing the trades. 

"By failing to comply with those rules," the panel said. "Johnson allowed Ross to make hundreds of trades in our markets that ought never to have taken place, all in violation of a trading ban imposed by this commission."

During interviews in 2004 and 2005, Johnson told commission investigators he was unaware the account holder had allowed Ross to use the account. He also said he did not know Ross had traded in the account. He later admitted that these statements were untrue, and a contravention of the Securities Act.

The panel described Johnson's statements as "the exact opposite of the actual facts," and noted that they "went to the heart of the matter under investigation." 

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, Edward Bernard Johnson or 2007 BCSECCOM 437. If you have questions, contact Ken Gracey, Media Relations, 604-899-6577.