A B.C. Securities Commission panel has found that three men—David Scott Wright, Donald Bruce Wilson, and Patrick K. Prinster—swindled 19 investors out of $610,134.
In addition, Wright and Prinster as well as DominionGrand Investment Fund Inc. defrauded 21 investors of $506,693.
According to a BCSC decision, almost all of the $1.1 million collected from investors was lost.
All three men were given lifetime bans on trading or purchasing securities, exchanging contracts, becoming or acting as a registrant or promoter, acting as management or consulting in the securities market, and engaging in investor relations.
"This case involved the diversion of investor funds from the purpose represented to the investors (to be invested principally in mortgages secured against real estate)," the decision states. "Investor funds were, for the most part, diverted to companies related to the corporate respondents."
The panel concluded that the three men were carrying out real business, which differentiated this case from Ponzi schemes, direct theft of investors' money, or wholly fictitious securities.
However, there was also no question that the investors were "substantially harmed".
"The corporate respondents were enriched by their misconduct," the decision states. "They were the direct recipients of the investors' funds."