BCSC panel finds three B.C. residents defrauded investors of $600,000
Vancouver – The British Columbia Securities Commission (BCSC) has ruled that three B.C. residents defrauded two investors of $600,000 in a scheme to manufacture and sell a new type of battery.
John Sand, Jolyon Charles Christopher Gulston and Karol Achs told the two B.C. investors that their investment would be used to build a local facility to produce zinc-air fuel cell batteries, and that there were already significant purchase orders for the batteries from around the world.
In fact, there were no orders for the batteries and little to no progress on the development of the production facility. Instead, Sand, Gulston and Achs used more than $360,000 of the funds for other purposes, including cash withdrawals, credit card payments, payments to themselves and other people, cell phone and grocery bills.
The two investors became concerned about the apparent lack of progress after a year and demanded the return of their investment. Only $200,000 of their investment has been recovered.
Gulston also told one potential investor that there was a large purchase order to be filled in a few months, and another potential investor that the new production facility would be a duplicate of a profitable facility that already existed in Washington state that could produce thousands of batteries each month. He claimed there was a guaranteed profit on investment, that there were four years’ worth of orders for batteries, and that there was interest or orders from across the globe, including from Africa and Asia. All of these statements were false.
The BCSC panel found that Sand and Gulston, both of West Vancouver, and Achs, of North Vancouver, participated in conduct that they knew was fraudulent by convincing the two investors to invest $600,000 based on lies and false statements.
The panel further concluded that Gulston also violated the Securities Act by knowingly making false statements to sell securities to the two potential investors.
The panel directed the parties to make submissions on sanctions according to the schedule set out in the findings.
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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