Veteran investment adviser permanently banned from securities market
Vancouver – The British Columbia Securities Commission permanently banned a veteran investment adviser from the securities market after he admitted to misleading investors, selling unsuitable investments, failing to disclose conflicts of interest, and making unauthorized discretionary trades.
George Melvin Grafton is permanently barred from buying or selling securities, acting as a director or officer or of any issuer, and engaging in investor relations activities except in limited circumstances. Grafton was the principal operator of Grafton Global Management Ltd. (formerly Grafton Asset Management Group Ltd.). Until 1997, he had been registered under the Securities Act for over 15 years in B.C.
In 1996 and 1997, clients of Grafton and Grafton Global invested over $5-million into Valley Mortgage and Investment Company Ltd., money that was lent to Kelowna area property developers.
In the settlement, Grafton admitted that in some cases he falsely told investors that the Valley investments were a lower risk investment than stock exchange-listed securities. In selling the Valley investments, he also failed to disclose a conflict of interest by not telling investors that he was behind the Valley investments. Grafton sold the illiquid and speculative Valley investments to investors when the investments were unsuitable for many of the clients. He also admitted that he bought Valley investments for some clients without informing them of the purchases until after the trades had been executed. He was not registered to make the discretionary trades.
Grafton’s permanent ban allows him to participate in the securities market in limited circumstances, including carrying out the terms of a confidential settlement to repay the Valley investors. The BCSC has permanently cease-traded the securities of Grafton Global and Valley.
The B.C. Securities Commission is an independent provincial government agency responsible for regulating trading in securities within the province. You may view the settlement on our website www.bcsc.bc.ca by searching for George Melvin Grafton, Grafton Global Management Ltd., Valley Mortgage and Investment Company Ltd., or 2005 BCSECCOM 3 & 4. If you have questions, contact Andrew Poon, Media Relations.