The Alberta Securities Commission (ASC) has released its sanctions decision in Re Floreani, 2025 ABASC 129, marking Alberta’s first full enforcement proceeding against a social media finfluencer.
The decision follows the ASC’s earlier liability finding that James Domenic Floreani and his company Jayconomics Inc. breached Section 103.1(2) of the Securities Act (Alberta). The commission said they failed to make “clear and conspicuous” disclosure that their social media posts promoting certain issuers were, in fact, paid advertisements.
The ASC ordered a two-year market ban, a joint administrative penalty of $30,000 and costs of $10,185.10. In determining that the administrative monetary penalty was necessary, the commission noted too low a penalty would be seen as “a mere licensing fee or a cost of doing business.”
Is that not precisely what the commission decided? The ASC declined to order Floreani to disgorge his earnings — substantial earnings at that — as part of its sanctions, noting that disgorgement was not in the public interest.
The panel found that the respondents received at least $90,000 in direct promotional payments, 20,000 restricted shares of Gold Mountain and more than $217,000 from Patreon subscriptions. That puts total revenue at about $300,000 — more than 10 times the administrative monetary penalty ordered.
The ASC noted that the door remains open to disgorgement orders in future cases. Still, the outcome here raises questions about deterrence: with penalties and costs totalling roughly $40,000, Floreani retained over $260,000 in net proceeds — more than three times the median Canadian household income. And he informed the ASC he had no intention of engaging in market-related activity, significantly reducing the appearance of any deterrent effect of the market-access ban.
Can general deterrence be achieved when the apparent financial rewards of finfluencing so far exceed the sanctions regulators impose?
Reliance on OSC research
A notable element of the decision was the ASC’s reliance on data from the Ontario Securities Commission’s (OSC) 2024 report, “Social Media and Retail Investing: The Rise of Finfluencers.” That report highlighted the pervasiveness of finfluencing in Canada.
It found that 35% of Canadian retail investors had made financial decisions based on finfluencer content, and that younger investors increasingly rely on YouTube and similar platforms for investment advice.
The ASC adopted the report’s findings to justify the need for general deterrence, noting that “finfluencing has few barriers to entry” and poses “real risks to market integrity” when conducted without proper disclosure. The commission emphasized that investor protection depends on viewers understanding when content is sponsored, and that non-disclosure deprives them of a vital safeguard.
By anchoring its reasoning in OSC research, the ASC elevated behavioural data into a legal justification for market-access restrictions. This approach offers some insight into how securities regulators may increasingly rely on investor-behaviour analytics to frame enforcement policy and tailor sanctions requests.
Rejecting U.S. comparisons
In fashioning sanctions, the panel expressly declined to rely on U.S. Securities and Exchange Commission decisions under Section 17(b) of the U.S. Securities Act of 1933 — a law prohibiting undisclosed paid promotions.
The ASC found that those cases were “of no value” because they arose under a different statutory regime and that U.S. capital market participants have a higher baseline awareness of anti-touting laws.
Instead, the ASC relied heavily on the reasoning of the B.C. Securities Commission in Re Stock Social Inc., 2023 BCSECCOM 372, which imposed modest penalties for similar misconduct. Both commissions treated their cases as matters of first impression of long-standing disclosure rules, preferring a “measured” approach aimed at setting guidance rather than punishment.
Takeaways for advisors and issuers
The Floreani sanctions decision underscores that regulators are watching online promotion closely and that even relatively small-scale influencer arrangements can fall squarely within investor-relations activity.
Yet the relatively low financial consequences compared with the revenues generated leave open whether deterrence will be strong enough without further enforcement action.
For financial professionals, two lessons stand out:
- Be transparent. Any paid relationship must be prominently disclosed. When content promotes an issuer, the paid relationship must be clearly and conspicuously identified.
- Make it obvious. Disclosures buried in fine print or hidden behind a link won’t suffice. While Floreani included disclosure in some of his content, it was not prominent. It was in legalese and required users to click a Show More button to see it. Some disclosure was added to videos over a year after they were posted.
Together with the earlier liability ruling, the sanctions decision completes a regulatory case study in how traditional investor-relations rules are being reinterpreted for the social media era.