A woman who was involved with alleged securities fraudster Sandy Winick has been sanctioned by the Ontario Securities Commisison (OSC) for her involvement in a couple of schemes.
The OSC ordered sanctions Tuesday against Andrea McCarthy, and two firms, BFM Industries Ltd. and Liquid Gold International Corp.
McCarthy was banned from trading and registration for 15 years, and ordered to pay a $10,000 administrative penalty; and the firms were ceases traded permanently.
According to the decision, OSC staff sought a $50,000 penalty against her, and disgorgement orders. However, the panel imposed a lesser penalty, and ordered no disgorgement.
In its decision, it noted that McCarthy was involved with the scheme in that she carried out orders from Winick, with whom she was romantically involved; that she fully cooperated with the investigation; she expressed remorse for her involvement; and, that she has had to cash in her RRSP to pay her legal fees and sell her house in order to meet her financial obligations; among other mitigating factors.
“McCarthy is not blameless in this matter. She acknowledges that she should have been more alert to the activities of Winick,” the OSC said in its decision. However, it ordered a smaller penalty than the one sought by OSC staff, saying that it is proportionate to the violations, and that it should be adequate to deter similar conduct by others.
Last year, the commission found Winick liable for his role in the frauds perpetrated by BFM and Liquid Gold, and it ordered him to pay over $1 million in disgorgement and monetary penalties for violations of Ontario securities law. He was arrested in Thailand last year, and faces securities fraud allegations in the U.S. Those charges have not been proven. (See Investment Executive, Winick’s girlfriend part of fraud: OSC, January 6, 2014.)