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by Mike Caswell

The B.C. Securities Commission has found Toronto lawyer Shimmy Posen liable for violations related to a trade in which he artificially lowered the price of a Canadian Securities Exchange listing. Mr. Posen, who was attempting to get approval for a financing, entered a half-cent trade through accounts he controlled at two different firms. The trade allowed the company to obtain approval for a three-cent private placement, the BCSC has found.

The findings are contained in a decision that the BCSC released on Wednesday, Nov. 4. The sole respondent is Mr. Posen, a partner at Toronto law firm Garfinkle Biderman LLP. The decision only deals with the issue of liability, and the BCSC will convene a separate hearing to determine Mr. Posen's penalty.

The trade at issue, as set out by the BCSC, was in Waraba Gold Ltd., a CSE listing with projects in Africa. The trade came with Waraba seeking approval to issue 10 million shares at three cents. The CSE initially refused, saying that the company's share price was not low enough for a three-cent placement. (If a placement is below five cents, the CSE looks at a company's 20-day volume-weighted average price. At the time, Waraba's average price was 7.8 cents, which was too high for a three-cent private placement.)

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