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While the business plan of an investment fund that raised $68 million from investors to finance equipment leasing may have been flawed, so too were allegations that the venture violated securities laws, the Alberta Securities Commission (ASC) found.

The ASC dismissed allegations against David Keith Talbot, principal of the Weslease Income Growth Fund and the Weslease Income Growth Fund Limited Partnership, which raised funds from investors in the exempt market to fund its leasing business.

The regulator’s enforcement staff had alleged Talbot breached the Securities Act and acted contrary to the public interest by misleading investors in connection with the venture.

While some of those initial allegations were withdrawn by ASC staff, a regulatory hearing panel has concluded the remaining allegations against Talbot were not proven during the hearing either.

Among other things, the panel found the regulator wasn’t able to establish that specific regulatory violations took place, despite the problems with the venture.

“Weslease’s business plan appeared to be challenging from the outset,” the panel said, adding that these challenges were compounded by rapidly changing economic conditions.

“Poor business decisions were clearly made. The due diligence efforts of those involved were problematic at times. However, the evidence did not support the very specific allegations in the [notice of hearing],” the panel said.

As a result, the panel declared the proceeding concluded.