A boiler room broker has been sentenced to two years probation after admitting to a fraud count, the Ontario Securities Commission (OSC) announced on Tuesday.
In addition, Sydney Klein of Thornhill, Ont., has been ordered to cease trading in securities, to refrain from soliciting trading activity and to resign any corporate officer or director positions, according to the OSC.
The sentence was handed down after Klein pleaded guilty to one count of defrauding the public, the regulator notes.
An investigation by the OSC’s Joint Serious Offences Team (JSOT) “revealed that he was operating a boiler room scheme that used dormant shareholder lists to make fraudulent solicitations to investors by telephone,” the OSC says.
The alleged boiler room, which was known as Dorchester International Group Inc., was operated from Markham, Ont. When Klein was first charged in November 2015, the OSC alleged that, “Victims were falsely told their worthless penny stock holdings may have future value and were solicited to purchase portfolio research reports that were of no value.”
The JSOT is an enforcement partnership between the OSC, the RCMP Financial Crime program and the OPP Anti-Rackets Branch, which was formed to investigate serious securities law violations.