The New Brunswick Securities Commission (NBSC) permanently banned Donald Addison Nason from trading in securities several years ago, but that did not prevent him from swindling investors out west. The Alberta Provincial Court has now sentenced him to nine months of house arrest.
Nason, who at one time had been an advisor with Dundee Private Investors in Fredericton, sold about $500,000 of shares in an Alberta company named Locate Technologies to New Brunswick investors without registration or prospectus and collected more than $88,000 in commissions. None of the money he raised was actually invested, but instead was used by Locate's president and sole director Lorne Drever for personal and other expenses. This took place between 2004 and 2006. In 2009, the NBSC permanently banned Nason from trading in securities for his part in the scam, and ordered him to pay an administrative penalty of $100,000.
What did Nason do? He did not pay the fine; he went to Alberta where he sold another $290,000 of Locate shares to other unsuspecting investors. In 2012 the Alberta Securities Commission (ASC) permanently prohibited all trading in Locate Technologies, and in the 2013 the securities regulator charged Nason in provincial court for engaging in illegal distributions, breaching a cease trade order, failing to attend to be questioned, and for making numerous misleading or untrue statements to investors.
In a sentencing judgment handed down last month, Judge Bruce Fraser described Nason as "a danger to the public" and "morally corrupt and blameworthy", and suggested that he had learned nothing from his previous sanctions. However, Judge Fraser noted that there were mitigating factors, namely that Nason has no criminal record and he did not profit from his misrepresentations. Nason had acted as a salesperson and handed the investors' funds over to Drever "and from there it disappears," reads the decision.
Fraser sentenced Nason to nine months of house arrest, during which he must remain in his residence, leaving only to either attend or look for work, to obtain the necessities of life, or to attend religious services and medical appointments. After this period, Nason will be obliged to observe a curfew from 10:00 p.m. to 7:00 a.m. seven days a week for another nine months. He must also complete 200 hours of community service.