CALGARY, March 16, 2012 /CNW/ - The Alberta Securities Commission (ASC) has concluded a settlement with James Roger Douglas, an insurance agent from Medicine Hat, Alberta. Under the Settlement Agreement, Douglas agreed to cease trading in all securities and exchange contracts for five years, and has paid the ASC $60,000 plus $10,000 in costs.
In the Settlement Agreement, Douglas acknowledged that he failed to take sufficient steps to ensure that trades made through his brokerage account by John Herbert (Bert) Holtby and Richard Kowalchuk were in compliance with Alberta securities laws. At the time, Bert Holtby was a director of Eveready Inc. and Kowalchuk was an investment advisor with CIBC Wood Gundy in Medicine Hat.
Douglas acknowledged that his account was to be used by Holtby and Kowalchuk as an "investment club" for the benefit of himself, Holtby and Kowalchuk. Douglas also admitted that, using his account, Holtby and Kowalchuk were able to secretly trade in shares of Eveready. Twenty-eight thousand Eveready shares were purchased through the account in March and April 2009, at prices between $2.50 and $3.50 per share. On April 29, 2009, Eveready announced it was being taken over by Clean Harbors Inc. and subsequently shares of Eveready jumped to over $10 per share. Douglas admits that, as a result of the way the investment club was set up, he profited in the amount of $40,000.
Kowalchuk entered into a Settlement Agreement with the ASC in April 2011, admitting to his role in the illegal insider trading that took place using the Douglas account and that his profit from the trades was approximately $100,000. Kowalchuk further admitted that Holtby, pursuant to the terms of their agreement, would be entitled to the same amount.
A hearing into the allegations against Holtby and others is set to commence on May 16, 2012 in the ASC Hearing Room on the 5th floor, 250 - 5th Street S.W., Calgary, Alberta..
Copies of the Settlement Agreements with Douglas and Kowalchuk, as well as the Notice of Hearing outlining the allegations against Holtby and others, can be found on the ASC website at www.albertasecurities.com.
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.
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