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by Mike Caswell

On Thursday, Aug. 27, the Investment Industry Regulatory Organization issued a somewhat mundane news release about a settlement agreement the regulator had reached with Gerald Stefaniuk, a former employee of Global Securities Corp. It cited him for discretionary and unauthorized trading. As is customary with unapproved settlements, IIROC gave no details, and said that information would only be available upon the regulator accepting the settlement.

What IIROC did not mention was Mr. Stefaniuk's history, which includes an unresolved criminal bribery case in the United States. In 2008 prosecutors in New Jersey charged him with conspiracy to commit securities fraud, claiming that he helped a client in a scheme to pay brokers a 50-per-cent fee to purchase shares in a pink sheets company. The client, Phil Wong, pleaded guilty to those charges and others, and received a 21-month jail term.

The U.S. charges, which are contained in an indictment filed on July 23, 2007, in the District of New Jersey, stemmed from a scheme to manipulate a listing named Secureware Inc. The company operated under the name Money House Financial Services and provided small, short-term loans to consumers. Mr. Wong was a promoter and major shareholder of Secureware, according to the indictment.

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