BCSC panel fines and permanently bans B.C. sisters for fraud and illegal distributions
Vancouver - A British Columbia Securities Commission (BCSC) panel has permanently banned Siu Mui "Debbie" Wong and Siu Kon "Bonnie" Soo from B.C.'s capital markets for illegal distributions and multiple acts of fraud. In the same decision, the panel also ordered permanent bans against two joint venture companies for illegal distributions. Wong and Soo are sisters and residents of B.C.
In June 2016, the panel found that Wong, Soo, and Wheatland Industrial Park Inc. illegally distributed securities. Wheatland was a joint venture company the sisters created to buy and develop land in Wheatland, Alta.
The panel also found that the sisters committed fraud by transferring 33.5 Wheatland joint venture units to companies owned by their adult children and husbands without consideration and without obtaining investor approval, and by misappropriating investors' subscription proceeds to fund two related company loans totalling $1,208,000 without the investors' permission.
The panel found that Soo, Wong, 1300302 Alberta Inc. and D&E Arctic Investments Inc. also illegally distributed securities. Similar to Wheatland, the sisters set up 1300302 and D&E Arctic to buy and develop land in Rocky View, Alta.
The panel also found that the sisters committed multiple acts of fraud with respect to the Rocky View development project. The panel found that the sisters inflated the purchase price of the Rocky View lands and lied about it to investors, and that they withheld information about potential delays in development of the Rocky View lands from an investor. On the basis of new evidence, the panel revoked its initial finding, made in June 2016, that the sisters had also used mortgage proceeds for purposes other than the development of the Rocky View lands without consent from investors.
The panel found that the sisters were enriched by over $2 million as a result of their misconduct. Describing the impact of Wong and Soo's misconduct, the panel wrote, "Investors testified as to their mental anguish and increased financial burdens. They have suffered those harms even if they later recoup their investments (for which there is no evidence to suggest that it is a possibility)."
For their misconduct, the panel has permanently banned Wong and Soo from trading in or purchasing any securities or exchange contracts (with limited exceptions), becoming or acting as a director or officer of any issuer or registrant (with limited exceptions), becoming or acting as a promoter, acting in a management or consultative capacity in connection with activities in the securities market, and engaging in investor relations activities. They have each been ordered to pay administrative penalties of $6 million.
The panel also ordered that 1300302 and D&E Arctic permanently cease trading in, and be permanently prohibited from purchasing, any securities or exchange contracts, and permanently banned them from engaging in investor relations activities. The panel further ordered that the respondents pay various disgorgement orders totaling $9,857,850 with joint and several liability:
- 1300302, Wong and Soo are ordered to pay $2,785,000 on a joint and several basis;
- D&E Arctic, Wong and Soo are ordered to pay $1,105,000 on a joint and several basis; and
- Wong and Soo are ordered to pay an additional $5,967,850 on a joint and several basis.
The panel declined to make market bans against Wheatland, as the company is no longer directed or controlled by Wong and Soo. The panel stated there is no evidence that the company poses a threat to B.C.'s capital markets.
You may view the sanctions decision on our website www.bcsc.bc.ca by typing Siu Mui "Debbie" Wong, Siu Kon "Bonnie" Soo, Wheatland Industrial Park Inc., 1300302 Alberta Inc., D&E Arctic Investments Inc. or 2017 BCSECCOM 57 in the search box. Information regarding disciplinary proceedings can be found in the Enforcement section of the BCSC website.
Please visit the Canadian Securities Administrators' Disciplined List for information relating to persons and companies disciplined by provincial securities regulators, the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association (MFDA).
About the British Columbia Securities Commission (www.bcsc.bc.ca)
The British Columbia Securities Commission is the independent provincial government agency responsible for regulating capital markets in British Columbia through the administration of the Securities Act. Our mission is to protect and promote the public interest by fostering:
- A securities market that is fair and warrants public confidence
- A dynamic and competitive securities industry that provides investment opportunities and access to capital
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