The Ontario Securities Commission has approved the settlement between staff of the commission and Luke McGee regarding the illegal distribution of securities of Saxton Investments Ltd.

McGee was involved with Saxton in 1996 and 1997. In 1997, he was Saxton’s vp, reporting to the president Allan Eizenga. McGee was a lawyer, called to the Ontario bar in 1993. He never was registered with the OSC.

In his settlement with OSC staff, approved November 15, McGee agreed that he actively participated in the illegal distributions of Saxton securities. Among other things, he was involved in the dissemination of inaccurate or misleading information to salespeople, prospective investors and investors. Notwithstanding outside legal advice in the summer of 1997 provided to McGee and others that no further funds should be raised, Saxton continued to distribute its securities.

In 1999, KPMG, Inc., as the court-appointed custodian of Saxton’s assets, reported that Saxton raised approximately $37 million from investors. KPMG opined that the value of the Saxton assets at its highest was $5.5 million.

In approving the settlement, the commission reprimanded McGee and imposed a 15 year cease trade order, a 15 year officer and director ban and a 15 year exclusion from the s.34(b) registration exemption. As a term of the settlement, Mr. McGee agreed to co-operate with staff in connection with the outstanding proceeding against Eizenga and Toronto lawyer Michael Tibollo.

The approved settlement with McGee is the twentieth approved settlement in the Saxton matter. Sanctions for respondents have ranged from a 90 day cease trade order to a 20 year cease trade order and 20 year officer/director ban.

Only two respondents remain in the Saxton matter: Eizenga, Saxton’s president, and Tibollo, a lawyer and the president of Saxton’s operating company. A date for the hearing against Eizenga and Tibollo is anticipated to be set by the end of the year.