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by Mike Caswell

Vancouver's George Stubos has agreed to serve a permanent penny stock ban and to pay $6.1-million to settle civil charges he faces from the U.S. Securities and Exchange Commission for an OTC Markets scheme. (All figures are in U.S. dollars.) The SEC said that Mr. Stubos, 56, unloaded millions of shares in two OTC Markets listings between 2012 and 2015. He concealed his holdings by using offshore nominees, according to the SEC.

The penalties for Mr. Stubos are contained in a judgment filed in federal court in New York on Sept. 8, 2023. The $6.1-million that he must pay includes disgorgement of $5.3-million in gains, plus interest. The order also permanently bars Mr. Stubos from penny stocks and restrains him from future violations. The judgment represents a negotiated settlement, in which Mr. Stubos has not admitted any wrongdoing.

Mr. Stubos has two years to pay the money, but it appears that the SEC will collect at least some amounts sooner. As part of the case, the SEC froze accounts at Canaccord Genuity Corp. and Canadian Imperial Bank of Commerce. Mr. Stubos has agreed to hand over the contents of those accounts to satisfy the judgment. He has also agreed to sell a home in Palm Springs, Calif., that is in his wife's name, with the proceeds to be used for the judgment as well.

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