The British Columbia Securities Commission (BCSC) is alleging that a former investment advisor improperly distributed securities without being registered or filing a prospectus.
The BCSC issued a notice of hearing Friday alleging that Robert Waters, who was registered as an advisor back between 1985 and 1998, promoted securities in an over-the-counter (OTC) issuer, Berkeley Coffee and Tea Inc., without a proper exemption. The allegations have not been proven.
The regulator’s notice alleges that the company distributed shares to 59 investors in April 2011, raising approximately $474,590. And, it says that Waters was responsible for bringing in 45 of those investors, representing proceeds of $312,976.
On May 6, 2011, Berkeley filed an exempt distribution report indicating that the securities had been sold under the family, friends and close business associates exemption. However, it says that none of the investors Waters recruited were eligible for that exemption, as he has never been a director, officer, or founder of Berkeley. And, BCSC staff contend that this represents a breach of securities law.
The regulator reports that Berkeley (which it says had previously filed a prospectus with the U.S. Securities and Exchange Commission (SEC), but never in BC) hassettled, admitting that it distributed these securities without having filed a prospectus. BCSC staff will apply to set dates for a hearing into the allegations against Waters on Jan. 22, 2013.