The problem with being a se-curities regulator in British Columbia is that you never know what bad news is going to land on your doorstep.

Lang Evans got a quick introduction to that harsh reality in late March, when, just as he was assuming his new position as director of enforcement at the B.C. Securities Commission, the Washington Post and Forbes magazine published stories reinforcing Vancouver’s reputation as a haven for penny-stock hustlers.

Although B.C. has a strong, legitimate aspect to its securities industry, the province’s financial reputation continues to be buffeted by scurrilous stock promoters who have been forced off the TSX Venture Exchange and onto the U.S. over-the-counter markets — but who continue to live and work in Vancouver.

“I’m quite proud of the improvement we have seen in the Vancouver Stock Exchange, its successor, the Canadian Venture Exchange, and now the TSX Venture Exchange,” Evans says. “But I am still troubled by the reputational impact of people who continue to abuse their access to the junior market.”

Evans now has a chance to influence the character of future securities business in B.C. On March 26, he replaced Sasha Angus as the province’s top securities enforcer. (Angus quit last October and is now special counsel and senior policy advisor for the enforcement branch of the Ontario Securities Commission.)

As the BCSC’s enforcement director, Evans is in charge of both investigations and prosecutions, which together employ about 45 people. It’s probably the toughest job at the BCSC — and, arguably, the toughest in Canadian securities regulation — but Evans is well suited for it.

Now 49, Evans was born in Toronto and graduated from Queen’s University in Kingston, Ont. He then articled as a chartered accountant at Touche Ross in Vancouver. After auditing a few public companies, he became a listings officer at the VSE, where he tangled with some of Howe Street’s most controversial promoters. One in particular was Harry Moll, who promoted many dubious companies during his two decades on Howe Street, including Pineridge Capital, which inflated and deflated with disastrous results for investors, prompting then-premier Glen Clark to appoint a commission of inquiry into the VSE.

However, in those days, when Evans was pursuing Moll, the regulatory system had much more bark than bite. Moll — and many others of his ilk — slipped the noose. It wasn’t until 1988, when Evans joined the newly minted BCSC, that he was able to make a more discernible impact.

He was lead investigator in the commission’s first enforcement hearing. The prosecution was a success: all the defendants were suspended from the market. Later, he became lead investigator for insider-trading cases against Murray Pezim, the legendary promoter, and against former premier Bill Bennett, his brother Russell and lumber magnate Herb Doman. Both were extremely vexing cases, but in the end, all subjects were handed suspensions.

DESIRE TO CLEAN UP THE STREET

In 1993, Evans was placed in charge of compliance and enforcement, but it would prove a very short and stressful appointment. At that time, the VSE was host to 2,000 junior companies, most of them dedicated to separating unwary investors from their money. That was the year Clark — fed up with the stock market mayhem — appointed the commission of inquiry into regulation of the VSE. The commissioner, Vancouver lawyer Jim Matkin, recommended that the BCSC be scrapped and replaced with a new securities board. It never happened, but it was a very scary brush with institutional mortality.

At about the same time, Evans hired Adrian du Plessis, a freelance stock market muckraker, as an investigator. Du Plessis was an excellent sleuth, and his hiring showed the commission was earnest in its desire to clean up the Street. However, within several months, du Plessis and several events coalesced to create a perfect storm.

Du Plessis began investigating two junior companies that were trying to get prospectuses receipted by the BCSC. Both were obvious frauds. Du Plessis and Evans recommended that neither prospectus be receipted, but BCSC executive director Dean Holley went ahead anyway.

Du Plessis blew the whistle. He publicly complained to the NDP government, sparking another government inquiry and much negative press. Evans took the high road; he bit his tongue and stepped down to resume his old job as a compliance officer.

@page_break@By 1999, however, Evans was back as deputy director of enforcement, in charge of investigations. Two years later, he was named deputy director of regulatory projects. Most recently, he has been director of capital markets regulation.

These tours of duty have seasoned him for a job that requires a great deal of practical knowledge and understanding. As enforcement director, he has to deal with highly legalistic hearing panels that require onerous levels of disclosure and evidence. The hearing panels, in turn, have to deal with highly legalistic defence lawyers and the constant spectre of court appeals. The result is that shutting down a single sleazeball promoter can be a Herculean task.

But Evans is intent on stemming the tide of OTC Bulletin Board companies and curbing the sale of unregistered securities, which wreak havoc on public investors. It’s a job that requires toughness, patience, experience, perseverance and good humour — all of which Evans has.

When asked what attracts him to regulation, he says, “I know it sounds corny, but I like working on the side of angels — in this case, serving the public interest.”

The regulatory bureaucracy will never be perfect, Evans says, “But I think that, by and large, it works very well. Registrants who are in a position of trust and responsibility generally do a good job. But there is a minority that do not, and we are doing our best to minimize their impact on the public.”

Evans says he hates to lose: “Losing is often the gap between what we suspect and what we can prove, and that’s often frustrating. Then, if we go forward and lose a case, I must admit I’m not happy, but I have to respect those decisions.”

He says the BCSC is developing some new policy tools that will help drive out the bad actors and improve the public perception of the Vancouver market. For one, the BCSC is contemplating a rule to designate companies that trade on U.S. OTC markets but are based in Vancouver as reporting issuers in B.C. This would extend the BCSC’s reach to penny-stock offerings that otherwise are beyond its reach.

Evans’ posting is being treated as a lateral move, so his salary and benefits will be similar to the $197,000 he made during the year ended March 31, 2006. (By comparison, his predecessor, Angus, made $234,000 last year.)

When asked what he does for recreation, Evans replied, “I’m an accountant, I’m dull beyond belief.” In truth, he’s a former Boston marathoner and still an avid cycler (he pedals to work every day) and cross-country skier.

His long-time partner is Mary Beck, vice president of compliance at Odlum Brown Ltd., perhaps Vancouver’s most respected brokerage firm. Evans says if he ever finds himself in a conflict of interest, he will quickly absent himself from any dealings with that firm. IE