An undercover police sting has implicated two Vancouver stock promoters and a stockbroker in an alleged bribery scheme.

Promoters Aarif Jamani and Bozidar (Bob) Vukovich, along with Scott Lower, an investment advi-sor with Global Securities Corp., are alleged to have provided secret commissions on three separate occasions to an undercover Federal Bureau of Investigation agent in New York.

The FBI agent was posing as a broker who could muster wealthy clients to buy shares in Novori Inc., a Surrey, B.C.-based company that trades on the Over-The-Counter Bulletin Board in the U.S.

The allegations have been made in information sworn to by Vancouver police seeking to obtain trading records from Global Securities. The investigation is still in progress and no charges have been laid.

The allegations are the latest in an extensive cross-border stock bribery sting operation involving Vancouver police, the Vancouver RCMP’s integrated market enforcement team and the FBI.

In September, Vancouver promoter John Zanic was arrested in Las Vegas for allegedly bribing an undercover officer to buy shares in Guyana Gold Corp., a U.S.-based OTC company that has had close ties to Vancouver.

In a separate case, the U.S. Secu-rities and Exchange Commission has alleged that New York promoter Jason Jadidian paid kickbacks to an undercover FBI agent to purchase shares of Tecton Corp., another U.S. OTC company with ties to Vancouver.

The SEC and the U.S. Justice Department have filed similar charges against Jonathon Curshen, who offers offshore financial services through his companies, Red Sea Management Ltd. in Costa Rica and Sentry Global Securities in Nevis. Both firms are believed to maintain accounts at Vancouver brokerage firms.

In an affidavit sworn to in order to obtain Global Securities’ trading records, Vancouver police Det. Const. Ann Fontaine states that Jamani, a certified management accountant, is the “target” of the investigation.

Jamani has made headlines before. In November 2006, the Vancouver Sun reported that Jamani and his brother, Nashrulla, were promoting two U.S. OTC stocks — Hybrid Technologies Inc. and Zingo Inc. — from an office on the sixth floor of 595 Hornby St. in Vancouver. Both companies have come under formal SEC investigation.

Then, in December 2007, the Vancouver Sun reported that Jamani and his brother were promoting Novori, an online jewellery retailer. The story questioned whether Novori was an earnest business or simply a stock promotion.

In Fontaine’s affidavit, she described how a Vancouver police undercover officer, posing as a drug trafficker who wanted to move into the stock market, introduced Jamani to the FBI undercover agent in New York. The agent was posing as a broker with a roster of wealthy clients.

Jamani then arranged for the “broker” to buy Novori shares in three separate transactions. The first transaction occurred on Sept. 27, 2007, when the New York undercover officer bought 32,000 shares at 46¢ each, for a total of $15,619.

The shares were sold by two accounts administered by Lower at Global Securities. The two accounts were Focus Capital Investments Inc. of Bermuda, and 775270 B.C. Ltd., whose sole director is Jamani’s wife, Feranza.

The next day, another numbered company, 718806 B.C. Ltd., wired $4,895 to the New York undercover officer. Jamani is the sole director of this numbered company. Similar transactions occurred on Oct. 3, 2007, and Oct. 12, 2007, resulting in payments of $4,400 and $4,530. Fontaine characterizes all these payments as secret commissions.

To confirm Vukovich’s participation, the Vancouver undercover officer set up a meeting with the three men on Jan. 17 of this year. During the meeting, which was filmed by a hidden camera, Vukovich told the undercover officer that the three men held the majority of Novori shares and that their business relationship was “like a marriage,” with the profits split three ways.

Vukovich and Jamani also said the certificates for Novori shares were held in a Swiss account; because of a series of “firewalls,” none of the three men show up as beneficial owners.

The three men agreed with the Vancouver undercover officer that the New York “broker” would buy $1 million worth of Novori shares in the near future and that the commission would be 30%.

Lower, a certified general accountant, is still working as a broker at Global Securities. The firm’s president, Doug Garrod, says Lower was placed on leave for several days after the company was served with the order to produce trading re-cords. Lower has since returned to work under strict supervision.

@page_break@Global Securities is a small Vancouver-based brokerage firm with a history of dealing in the sort of stocks that attract keen regulatory attention.

In March 2000, what was then the Vancouver Stock Exchange alleged that the firm’s owner and chairman, Art Smolensky, had traded shares of VSE-listed Trooper Technologies Inc. on the basis of inside information, then attempted to mislead exchange investigators.

A year later, Smolensky settled the matter by admitting he should have known his trades would create an artificial price for the stock. He agreed to a $115,000 fine and a 30-day suspension.

Then there was Global Securities broker Stephen Toban. From 1999 to 2001, Toban opened accounts for 35 U.S. clients who traded shares of an OTCBB “pump-and-dump” scheme. Many of those clients had regulatory and criminal records. After a lengthy hearing, Toban was banned from securities trading for life.

The Investment Industry Regulatory Organization of Canada accused Global Securities of failing to supervise Toban properly, but a hearing panel ruled there is a six-year limitation period and it had expired. IIROC is appealing that decision.

Garrod contends that most of these misdealings occurred outside the firm’s compliance purview. He also says that if the fine amounts are added up: “You’re not going to find Global Securities at the top of the list [of offending firms].”

Garrod also says that the firm has been tightening up its compliance and reducing its OTCBB
business. IE