The Ontario Securities commission has approved a settlement with DJL Capital Corp. and Dennis Little. The respondents faced allegations relating to their involvement with the illegal distribution and sale of units of Dual Capital Limited Partnership and DJL Capital to investors in Ontario.

The OSC ordered that DJL Capital and Little cease trading securities permanently, with the sole exception that after five years Little be permitted to trade securities through a registered dealer for his RRSP account.

As a term of the order, Little agreed never to apply for registration in any capacity under Ontario securities law. Little is prohibited permanently from becoming an officer or director of any issuer and from becoming or acting as an officer or director of any issuer, which has an interest directly or indirectly in any registrant.

Under the terms of the settlement, Little is permitted 180 days to wind up several companies in which he holds the position as sole officer or director, and must resign his position as officer or director of those companies effective 180 days from the date of the OSC’s order.

Little was registered as the trading officer and director of DJL Capital, a limited market dealer. Between August 1997 to September 1998, he sold approximately $950,000 worth of units in DJL Capital contrary to the prospectus and registration requirements of Ontario securities law.

Funds accepted from investors for the purchase of DJL Capital Units were not used for purposes set out in the DJL Capital Offering Memorandum. Investor funds were used for payments to Little in the amount of at least $58,000.00.

In addition, investor funds of at least $654,000 were deposited to an account held in the name of Heritage Arabian Farms Ltd., an Ontario company which carried on the business of providing board and care for horses. Little was the sole officer and director of Heritage.

Little also admitted that he made false and misleading representations to investors of DJL Capital.

Between October 1994 to December 1996 Little traded units in the Dual Capital Limited Partnership contrary to the prospectus and registration requirements of Ontario securities law. DJL Capital was the promoter and received payments in the amount of US$161,525.00 when Little knew that the source of payments were funds received from investors and not income earned from any investment made by the Dual Capital Limited Partnership.

DJL Capital made payments to Dual Capital in the amount of US$97,964.00. In his capacity as the sole officer of DJL Capital, the promoter, Little prepared promotional material which contained false and misleading representations to the Dual investors.

Vice chair Moore, in his oral decision approving the settlement, commented that “the respondents’ conduct demonstrates a blatant disregard for Ontario securities law, undermines the integrity of the capital markets of Ontario, and erodes investor confidence”.