ASC rules Gold-Quest International Investment Scheme a Ponzi and Pyramid

CALGARY, Jan. 21 /CNW/ - The Alberta Securities Commission (ASC) has found that Nevada-based Gold-Quest International Corp. raised approximately US$29 million from approximately 2940 investors, with more than US$2 million from approximately 412 Alberta investors, through a sham investment scheme that was both a classic Ponzi scheme and a classic pyramid scheme. Gold-Quest International investors were enticed with promises of 87.5% returns from foreign currency trading, as well as promises of referral payments for the recruitment of new investors.

An ASC panel determined that, contrary to information provided to Gold-Quest International investors, Gold-Quest International depended on the influx of new investors' money to make its payments to existing investors. The ASC panel also noted that millions of dollars of Gold-Quest International investors' money made their way to promoters of Gold-Quest International and were apparently used to pay their personal expenses.

The ASC panel ruled that Gold-Quest International illegally traded in and distributed securities in Alberta and that David Michael Greene, John Jenkins, Michael McGee and Delroy Atwood illegally distributed securities in Alberta. The ASC panel also ruled that Gold-Quest International and Greene made misleading and untrue statements about the anticipated returns and the safety of investments in Gold-Quest International and that Jenkins, McGee and Atwood authorized, permitted or acquiesced in such misconduct by Gold-Quest International.

The ASC panel set deadlines, up to and including March 5, 2010, for the filing of written submissions regarding sanctioning, and the parties have until March 10, 2010 to indicate if they wish to make oral submissions.

A copy of the decision is available on the ASC website at

The ASC is the regulatory agency responsible for administering the province's securities laws. It is entrusted to foster a fair and efficient capital market in Alberta and to protect investors. As a member of the Canadian Securities Administrators, the ASC works to improve, coordinate and harmonize the regulation of Canada's capital markets.

SOURCE Alberta Securities Commission

For further information: For further information: For Media Inquiries: Mark Dickey, Senior Communications Advisor, (403) 297-4481; For Investor Inquiries: ASC Public Inquiries, Toll Free 1-877-355-4488

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