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Oct 09, 2020
CALGARY – The Alberta Securities Commission (ASC) has found that Nicholas John Felgate breached Alberta securities laws by failing to comply with an interim cease trade order (ICTO) issued by an ASC panel on March 2, 2018 and extended twice. The ICTO was in effect during the time Felgate traded securities, in violation of section 93.1 of the Securities Act (Alberta).
In May 2019, Felgate entered into agreements with two investors, each document described as “Lender/Loan Personal Non Securities Related Agreement” and “Promissory Note”. Felgate argued that the agreements were not securities and thus were not subject to the Act. However, the ASC hearing panel ruled that the agreements were securities under the Act, and that Felgate breached the ICTO by trading in these securities.
In issuing its decision, the panel noted that “Felgate solicited, directly and indirectly, the sale of securities (the agreements) and he sold those securities (the agreements)…for money. Therefore Felgate engaged both in actual sales of securities and in acts in furtherance of those sales of securities."
This proceeding now moves to a second phase to determine what (if any) orders for sanctions and costs ought to be made against Felgate. The panel will set the timing of next steps in the proceeding after hearing from the parties.
A copy of the decision is available on the ASC website at 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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