William Wade Furman [Decision]

2019 BCSECCOM 214
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2019 BCSECCOM 214

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Securities Act, RSBC 1996, c. 418


Citation:    Re Furman, 2019 BCSECCOM 214                                Date: 20190610


William Wade Furman


Nigel P. Cave

Vice Chair


Audrey T. Ho



Suzanne K. Wiltshire




Submissions Completed

May 9, 2019


Decision date

June 10, 2019




Nicholas Isaac

For the Executive Director


  1. Introduction
  2. This is the sanctions portion of a hearing under sections 161(1) and 162 of the Securities Act, RSBC 1996, c. 418. The Findings of this panel on liability made on April 3, 2019 (2019 BCSECCOM 107) are part of this decision.
  3. We found that that the respondent contravened section 57(b) of the Act in respect of 12 investments for total proceeds of at least $452,000.













  1. Analysis
  2. Factors
  3. Orders under sections 161(1) and 162 of the Act are protective and preventative, intended to be exercised to prevent future harm.  See Committee for Equal Treatment of Asbestos Minority Shareholders v. Ontario (Securities Commission),2001 SCC 37.



In making orders under sections 161 and 162 of the Act, the Commission must consider what is in the public interest in the context of its mandate to regulate trading in securities.  The circumstances of each case are different, so it is not possible to produce an exhaustive list of all of the factors that the Commission considers in making orders under sections 161 and 162, but the following are usually relevant:


•     the seriousness of respondent’s conduct,

•     the harm suffered by investors as a result of the respondent’s conduct,

•     the damage done to the integrity of the capital markets in British Columbia by the respondent’s conduct,

•     the extent to which the respondent was enriched,

•     factors that mitigate the respondent’s conduct,

•     the respondent’s past conduct,

•     the risk to investors and the capital markets posed by the respondent’s continued participation in the capital markets of British Columbia,

•     the need to demonstrate the consequences of inappropriate conduct to those who enjoy the benefits of access to the capital markets,

•     the need to deter those who participate in the capital markets from engaging in inappropriate conduct, and


B.        Application of the Factors

Seriousness of the conduct





Risk to investors and the markets and fitness to be a director or officer

Harm to investors/ Enrichment





Mitigating or aggravating factors; past misconduct


Prior orders in similar circumstances




C.        Analysis of appropriate orders

Market prohibitions



Section 161(1)(g) orders


I now turn to apply these principles to the three appeals before this Court.  I agree with and adopt the two-step approach identified by Vice Chair Cave in SPYru at paras 131-132:


[131]    The first step is to determine whether a respondent, directly or indirectly, obtained amounts arising from his or her contraventions of the Act.  This determination is necessary in order to determine if an order can be made, at all, under section 161(1)(g).


[132]    The second step of my analysis is to determine if it is in the public interest to make such an order.  It is clear from the discretionary language of section 161(1)(g) that we must consider the public interest, including issues of specific and general deterrence.



  1. The purpose of s. 161(1)(g) is to deter persons from contravening the Act by removing the incentive to contravene, i.e. by ensuring the person does not retain the “benefit” of their wrongdoing.


  1. The purpose of s. 161(1)(g) is not to punish the contravener or to compensate the public or victims of the contravention.  Those objectives may be achieved through other mechanisms in the Act, such as the claims process set up under Part 3 of the Securities Regulation or the s.157 compliance proceedings in the Act.


  1. There is no “profit” notion, and the “amount obtained” does not require the Commission to allow for deductions of expenses, costs, or amounts other persons paid to the Commission.  It does, however, permit deductions for amounts returned to the victim(s).


  1. The “amount obtained” must be obtained by that respondent, directly or indirectly, as a result of the failure to comply with or contravention of the Act.  This generally prohibits the making of a joint and several order because such an order would require someone to pay an amount that person did not obtain as a result of that person’s contravention.


  1. However, a joint and several order may be made where the parties being held jointly and severally liable are under the direction and control of the contravener such that, in fact, the contravener obtained those amounts indirectly.  Non-exhaustive examples include the use of a corporate alter ego, use of other person’s accounts, or use of other persons as nominee recipients.



Step 1 – Can a section 161(1)(g) order be made?

Step 2 – Is it in the public interest?

Administrative penalties




  1. Orders
  2. Considering it to be in the public interest, and pursuant to sections 161 and 162 of the Securities Act, we order that:


(a)        under section 161(1)(d)(i),  Furman resign any position he holds as a director or officer of an issuer or registrant;


(b)        Furman is permanently prohibited:






(v)     under section 161(1)(d)(iv), from acting in a management or consultative capacity in connection with activities in the securities market; and


(vi)    under section 161(1)(d)(v), from engaging in investor relations activities;


(c)        Furman pay to the Commission $410,847.97 pursuant to section 161(1)(g) of the Act; and



(d)       Furman pay to the Commission an administrative penalty of $350,000 under section 162 of the Act.


June 10, 2019


For the Commission









Nigel P. Cave

Audrey T. Ho

Vice Chair








Suzanne K. Wiltshire