The Ontario Securities Commission has laid quasi-criminal charges against four people for alleged securities fraud in connection with an apparent advance fee scheme that involved perpetrators posing as OSC staff in some cases.
Last week, the OSC brought charges against Michael Chomica, Jan Chomica, Peter Siklos and Anna Hrynisak in connection with alleged breaches of the Securities Act. According to the information filed in the case, Michael and Jan Chomica are accused of perpetrating fraud on behalf of a company known as Global Consulting and Financial Services between October 2009 and 2010, in the securities of six companies; and, on behalf of Global Capital Group between March and September 2010; Michael Chomica and Siklos face one count of fraud involving the securities of several firms on behalf of Crown Capital Management between October 2009 and October 2010; and, Michael Chomica and Hyrnisak face a further count relating to the securities of several other firms on behalf of Heritage Management Group.
None of the allegations have been proven, and the first court appearance is set for June 12. Several of the accused in the case are currently subject to temporary cease trade orders, which were first filed in 2010, and have been extended multiple times by the commission since then.
Back in November 2010, the OSC first issued a temporary cease trade order against the Chomicas, and others, along with firms named in the information, Global Consulting and Financial Services and Crown Capital Management (and a couple of firms that aren’t named in the quasi-criminal complaint, Canadian Private Audit Service and Executive Asset Management), amid allegations that they were running what appears to be an advance fee scheme that involved contacting investors in Canada, the U.S. and the UK, that were holding illiquid securities and offering to sell those securities for the investors at a substantial premium, in exchange for an upfront fee.
At the time, the OSC said that, in some instances, representatives of the firms were impersonating OSC staff, and staff of the U.S. Securities and Exchange Commission, in an effort to convince investors to pay advance fees. It noted that the firms were not registered, and said that it “considers the impersonation of its staff to be serious illegal activity.”