A British Columbia Securities Commission (BCSC) panel has fined and permanently banned a self-styled day trader from the province’s capital markets for fraud and lying to a commission investigator.
According to the panel’s decision, Hussein Dhala took $38,250 from four investors on the premise that he could purchase shares for them in a private placement by a TSX Venture issuer. However, the panel found that the shares were never purchased, and that Dhala actually spent $26,900 of their money on personal expenses. The panel also concluded that Dhala lied to a BCSC investigator while under oath, when he said that he only dealt with one investor, rather than the four individuals he’d actually taken money from.
Dhala did not participate in the hearing, or present a defence to the allegations, so the panel issued its sanctions along with its initial decision on liability. In addition to a permanent trading ban, it also ordered that he banned from the markets, and ordered to pay a $125,000 penalty, along with disgorgement of $26,900.
In its decision, the panel said, “Dhala’s conduct is an egregious form of fraud. In this case, Dhala lied to the investors to induce them to give him money and then simply spent the money on his personal expenses. Dhala then continued his deceit by lying under oath to commission staff about his activities. This is serious misconduct in and of itself.”