A British Columbia Securities Commission (BCSC) panel has imposed a market ban on a man after finding that he engaged in an “extended, premeditated scheme to deceive the capital markets as to the true ownership” of a publicly traded shell company.
The panel ruled that Matthew John Hamilton must resign any position he holds as a director or officer of an issuer or registrant, and is prohibited for seven years from taking any such role. He also is barred for seven years from trading in or purchasing securities or exchange contracts, except under limited circumstances.
Concealed his control over publicly traded company
Hamilton created publicly traded shell company Guru Health Inc. that traded on the OTC Bulletin Board in the United States. He concealed his control over Guru by installing nominee directors and officers, and prepared and filed false disclosure documents with securities regulators, said the panel.
He also concealed his identity from critical gatekeepers in the capital markets when doing company business and provided them with fabricated records, and created the false impression that trades in Guru shares had occurred with 27 investors, when all shares were actually paid for by Hamilton and a business partner. He then secretly sold his control of Guru.
Although there was no evidence of specific harm to investors, the panel said Hamilton was enriched by the misconduct, and that such deception causes “significant harm to our capital markets.”