Downshire Capital inc.Court imposes fines and Tribunal lifts orders
Decisions and Freeze and cease trade orders Securities
Montréal – On December 20, 2017, Judge Claude Leblond of the Court of Québec, district of Montréal, imposed fines totalling $850,000 on Downshire Capital inc. and Daniel Ryan.
The decision was further to a penal proceeding launched by the Autorité des marchés financiers (the “AMF”) in 2014. Downshire Capital inc., Daniel Ryan and Carol McKeown each faced four charges for influencing or attempting to influence the market price or the value of the securities of Biocentric Energy Holdings inc., Converge Global, Hydrogenetics and Quri Resources inc. through unethical, abusive or fraudulent practices.
Given that Downshire Capital inc., through its officer and director Carol McKeown, and Daniel Ryan pleaded guilty prior to the court appearance, the AMF requested a conditional stay of proceedings with respect to two of the charges against each party and asked that the four charges against Carol McKeown be withdrawn. After agreeing to these requests, Judge Leblond ratified the joint recommendation of the parties and imposed a fine of $500,000 on Downshire Capital inc. and one of $350,000 on Daniel Ryan.
On February 7, 2018, at the request of the AMF, the Tribunal lifted the freeze orders initially issued on June 25 and October 18, 2010. The request to lift the freeze orders was made in the context of an agreement between the Agence du revenu du Québec and the Canada Revenue Agency in the settlement of debts owed to them by Carol McKeown.
The AMF’s investigation revealed that Downshire Capital inc. and Daniel Ryan issued information, via e-mail and a website, about the above-mentioned companies in order to entice investors to buy their shares and thereby artificially boost the volume of transactions. The respondents benefited from this pump and dump scheme by selling their own holdings and pocketing hefty profits.
The Autorité des marchés financiers is the regulatory and oversight body for Québec’s financial sector.
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