TORONTO, July 23, 2012 /CNW/ - In a decision released on July 19, 2012,
an Ontario Securities Commission (OSC) panel found that Shaun Gerard
McErlean (McErlean) and Securus Capital Inc. (Securus) breached the
Ontario Securities Act in connection with raising approximately $14
million from eight offshore investors.
In its decision, the Panel found that McErlean and Securus breached the
Securities Act by committing a fraud upon investors, trading securities
without being registered, trading securities without filing a
prospectus with the Commission and advising respecting securities
without being registered.
The Panel held that Mr. McErlean represented to all investors that their
money would be segregated in a separate account and would be used as
collateral for investments in guaranteed, high-return trading. None of
the money from the investors was used for that purpose. None of the
money was kept separate and apart from the Securus bank account as was
represented to investors.
The Panel found that steps were taken by Mr. McErlean, through the use
of screen shots and false bank account numbers, to deceive investors
into thinking their funds were separate and secure. All the investors
funds were used by Mr. McErlean to pay personal expenses, to repay
previous investors and to invest in private companies in which he or
his family members had a financial interest. Ultimately the Panel
found that Mr. McErlean's dishonest acts caused investors' funds to be
placed at risk or lost entirely.
The Panel ordered the parties to appear before the panel on August 13,
2012 to set a date for a hearing with respect to sanctions and costs.
The mandate of the OSC is to provide protection to investors from
unfair, improper or fraudulent practices and to foster fair and
efficient capital markets and confidence in capital markets. Cease
trade orders prohibit individuals or companies from trading in
securities. Investors are urged to check the registration of any person
or company offering an investment opportunity and to review the OSC
investor materials available at www.osc.gov.on.ca.
SOURCE: Ontario Securities Commission
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