Sask. financial watchdog says Alta. man fined $500K for investor fraud

A man is facing $500,000 in penalties after committing fraud and making untrue or misleading statements to investors.

On Thursday, the Financial and Consumer Affairs Authority of Saskatchewan (FCAA) sanctioned Ronald James Aitkens and four companies he owns and operates, according to a news release.

Aitkens raised over $84 million from thousands of investors, including hundreds in Saskatchewan, through a variety of proposed land development schemes.

Dallas Smith, legal counsel for the FCAA's securities division, said the case is "one of the largest securities fraud that our office has dealt with." 

A hearing on the fraud took place in May of 2018 and members of a FCAA panel considered Aitkens's breaches to be "very serious, and their conduct, egregious."

The FCAA informed Aitkens of a hearing on the sanctions following the initial hearing, but he did not attend nor did he send representation.

"As a result of the Respondents' fraudulent actions, funds were misappropriated from investors and hundreds of Saskatchewan residents lost their investments," a report detailing the decision explained. 

The panel found that Aitkens collected $10.4 million from Saskatchewan residents over three projects, with the FCAA concluding "investors experienced significant losses of capital."

"The panel pointed out that Aitkens acted with blatant disregard for the securities laws of Saskatchewan and that as a result, hundreds of Saskatchewan residents have lost their investments," said the release.

Aitkens and four companies he owns must now pay $100,000 each. They must also pay hearing costs, estimated at over $30,000.

Smith said the main goal of the FCAA publishing their findings about Aitkens is to protect future investors in Saskatchewan. 

"People need to know about situations like these and how they occur so they can protect themselves in the future," she explained. 

Smith said there are several steps consumers can take to protect themselves. Firstly, to make sure the person they're dealing with is registered. People are also advised to read any materials they receive and "not to be tricked" by any glossy brochures or executive summaries.

Lastly, people are always told to get advice from a professional advisor before investing in anything.

Smith said those who made investments with Aitkens are encouraged to go back to the board of directors, because some of the companies have been restructured.

Aitkens is also banned from trading in securities or derivatives using any exemptions in Saskatchewan securities laws and subject to market-access bans in other jurisdictions.

In a 2018 decision, the Alberta Securities Commission found that Aitkens "perpetrated a fraud on investors in Alberta" and that he and Harvest Capital made "misrepresentations by omitting certain information from the offering memoranda used to raise capital."