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by Mike Caswell

The U.S. Securities and Exchange Commission has concluded its case against a boiler room run from Surrey and Calgary by winning a $12-million judgment against an offshore firm accused of helping the scheme, Gibraltar Global Securities Inc. (All figures are in U.S. dollars.) The SEC claimed that Gibraltar allowed a group of Canadians to anonymously sell millions of shares. Among other things, it opened accounts in the names of fake nominee entities, the SEC said.

The penalties mark the conclusion of a case the SEC pursued against a group that included Canadian brothers John and Benjamin Kirk. The regulator claimed that the group boosted a pair of pink sheets listings, Pacific Blue Energy Corp. and Tradeshow Marketing Ltd., with misleading claims about solar power and infomercials. Both stocks went to well over $1 before falling under a penny.

The penalties against Gibraltar are contained in judgment handed down in New York on Wednesday, May 3. The decision is one by default, as Gibraltar stopped fighting the case long ago. The sanctions include a restraining order that bars future violations. The judge has also ordered Gibraltar and its founder, Warren Davis, to pay $11.9-million, representing gains from share sales routed through the firm, plus interest. On top of that, Mr. Davis must pay a $150,000 fine and Gibraltar must pay $225,000.

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