British Columbia Bans U.S. Resident From Securities Market, Says She Was Pushing Fraud Schemes For Commissions

breakingnews72The British Columbia Securities Commission, which regulates securities in the Canadian province, has banned a U.S. resident who allegedly promoted a series of schemes on commission.

“Sharon Downing has admitted that she engaged in an illegal distribution of securities,” BCSC said.

Downing, according to BCSC, promoted schemes for Thomas Arthur Williams and six entities engaged in raising money illegally.

Some of the cash went to persons with criminal records or who were securities-fraud recidivists, BCSC charged, describing money movement as akin to a Ponzi scheme.

The agency identified the companies as:

  • Global Wealth Creation Opportunities Inc.
  • Global Wealth Creation Opportunities Inc. (Belize).
  • Global Wealth Financial Inc.
  • Global Wealth Creation Strategies Inc.
  • CDN Global Wealth Creation Club RW-TW.
  • 2002 Concepts Inc.

The case demonstrates that persons living in the United States who push illegal schemes based in Canada can be charged by provincial regulators.

Downing not only pushed the schemes for commission as a “finder,” she also invested in them, BCSC said.

“Downing invested $60,000 of her own money in the Global Group of Companies and has no reasonable prospect of its recovery,” the agency said in a settlement agreement with her.

All in all, Downing drove $180,000 in business to the Global entities, receiving $3,231 in commissions, the agency said.

Williams, BCSC said in 2014 when he and the Global entities were charged, is a British Columbia resident who was “the directing mind, director and officer” of the purported opportunities.

The 2014 notice alleged that “Williams made promises to investors, including that their investments were shielded from securities laws, that he would provide returns of at least 2% interest per month with a potentially higher interest rate on a ‘best efforts’ basis, and that he would preserve the integrity of their funds.”

It is somewhat common for scammers to claim that securities laws do not apply to the investment programs they are offering.

“During the relevant period, none of the respondents were registered under the Act in any capacity, and the Global Group of Companies has never filed a prospectus in respect of the distribution of its securities,” BCSC said.

The schemes “raised approximately $11.7 million from 123 investors between February 2007 and April 2010,” BCSC alleged.

And, the agency charged, “Williams invested about $5.8 million of investor funds with individuals and companies introduced by or connected to persons who had criminal or regulatory histories of securities fraud. Williams did not inform investors about the fraudulent background of the people he was dealing with, nor did he receive any returns or principal from any of the investments he made.

“Williams did not inform his investors that none of his investments produced any returns, but rather continued to raise more money from investors, provided monthly statements showing fictitious returns of up to 4% on their investments, and paid ‘interest’ and principal payments to some investors from other investors’ money,” BCSC said.

Under the settlement agreement, Downing will pay BCSC the $3,231 in commissions she had posted.

The agreement also prohibits her “from trading in securities (with limited exceptions), and from becoming or acting as a promoter or registrant for a period of three years. Downing is also banned, for the same period, from acting in a management or consultative capacity in connection with the securities market, and from engaging in investor relations activities.”

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