TORONTO, Aug. 11, 2014 /CNW/ - In a decision released today, an Ontario Securities Commission panel has ordered substantial monetary sanctions against Crown Hill Capital Corporation and Wayne Lawrence Pushka for breaches of their fiduciary duty under the Securities Act, by using fund assets for their own benefit. In addition to monetary sanctions in excess of $20 million, trading and registration bans were imposed for ten years, or until the monetary sanctions are paid to the Commission.
"Today's decision demonstrates the OSC's commitment to ensuring fund managers, entrusted with investor's money, are abiding by their fiduciary duty," said Tom Atkinson, Director of Enforcement at the OSC. "It also sends a clear message to the marketplace that if you break the rules, you're going to pay – the Commission doesn't shy away from ordering large monetary penalties when the amounts obtained are a result of non-compliance with Ontario securities law and abusing the trust of investors."
Today's decision follows an earlier decision dated August 23, 2013, where an OSC Panel held that Crown Hill, as investment fund manager, and Pushka, as the directing mind and sole shareholder of Crown Hill, committed multiple breaches of their fiduciary duty to Crown Hill Fund and its predecessor, and that they acted contrary to the public interest. The Panel found that Pushka "orchestrated" the various events and transactions and "manipulated them to obtain his intended outcomes...". The Panel found that Pushka "misled" the independent directors of Crown Hill's Board of Directors and the members of the Independent Review Committee at times and, in any event, failed to make full disclosure to them. Overall, the panel found that Pushka's conduct was "appalling for a person in a fiduciary relationship with CHF [Crown Hill Fund] (and its predecessors)."
In addition to ordering disgorgement in the amount of $18,237,047, the panel also ordered Crown Hill and Mr. Pushka to pay administrative penalties in the aggregate amount of $1,875,000 as it noted that disgorgement alone did not provide sufficient deterrence. Documents related to this matter are available on the OSC website at www.osc.gov.on.ca.
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. Investors are urged to check the registration of any person or company offering an investment opportunity and to review the OSC's investor materials available at www.osc.gov.on.ca.
SOURCE: Ontario Securities Commission
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