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by Mike Caswell

The U.S. Securities and Exchange Commission and the Alberta Securities Commission have filed parallel cases stemming from the 2013 collapse of Poseidon Concepts Corp., a now defunct oil services company. The SEC claims that one of the company's senior executives, Joseph Kostelecky, orchestrated a financial fraud that involved recording about $100-million (U.S.) in improper revenues. The revenues were based on contracts that were uncollectible or did not even exist, according to the SEC.

The allegations come about two years after Poseidon, a former Toronto Stock Exchange listing, collapsed amidst a massive revenue restatement. The company reported on Feb. 14, 2013, that between $95-million and $106-million of its revenue for the first nine months of 2012 was incorrect. The resulting restatement wiped out most of the company's $148-million in revenue for the period. The stock, which had traded as high as $16.90 in 2012, hit 27 cents that month. Two months later the company delisted from the TSX, and it is now defunct.

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