Gracey <kgracey@bcsc.bc.ca>
Subject: BC Securities Commission News Release: CEO and mining company foundliable for false or misleading statements
PLAIN TEXT:
https://www.bcsc.bc.ca/News/News_Releases/2018/77_CEO_and_mining_company_found_liable_for_false_or_misleading_statemen
--->ts/
CEO and mining company found liable for false or misleading statements
2018/77
October 12, 2018
Vancouver - A British Columbia Securities Commission (BCSC) panel has found<https://www.bcsc.bc.ca/Enforcement/Decisio
--->ns/Mountainstar_Gold_Inc__and_Brent_Hugo_Johnson__Findings_/> that Brent Hugo Johnson and Mountainstar Gold Inc. made
--->repeated false or misleading statements in required public filings.
The BCSC panel found that between December 2012 and December 2015, Mountainstar, a reporting issuer in B.C., made fals
--->e or misleading statements in its management discussion and analysis (MD&A) concerning certain Chilean mining claims a
--->nd related legal proceedings, or Mountainstar omitted facts that were necessary to make the statements not false or mi
--->sleading.
Johnson was at all relevant times the president, CEO and a director of Mountainstar. The panel found that Johnson was
--->liable for Mountainstar's contraventions of the Securities Act, as he was clearly aware of the filing of the MD&A in i
--->ssue and had the ability to influence the content.
The panel did not accept the respondents' argument that they had exercised due diligence in making the disclosure. The
---> panel found that the respondents' failed to "exercise the reasonable diligence required to find out whether the state
--->ments were false or misleading."
The panel directed the parties to make submissions on sanctions according to the schedule set out in the findings.
You may view the findings decision on our website, www.bcsc.bc.ca<http://www.bcsc.bc.ca/>, by typing Mountainstar Gold
---> Inc., Brent Hugo Johnson, or 2018 BCSECCOM 317 in the search box. Information about disciplinary proceedings can be f
--->ound in the Enforcement section<https://www.bcsc.bc.ca/Enforcement/> of the BCSC website.
Please visit the Canadian Securities Administrators' (CSA) Disciplined List<http://www.securities-administrators.ca/di
--->sciplinedpersons.aspx?id=74> for information relating to persons and companies disciplined by provincial securities re
--->gulators, the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual Fund Dealers Association of
---> Canada (MFDA).
About the British Columbia Securities Commission (www.bcsc.bc.ca<http://www.bcsc.bc.ca/>)
The British Columbia Securities Commission is the independent provincial government agency responsible for regulating
--->capital markets in British Columbia through the administration of the Securities Act. Our mission is to protect and pr
--->omote the public interest by fostering:
A securities market that is fair and warrants public confidence
A dynamic and competitive securities industry that provides investment opportunities and access to capital
- 30 -
Media Contact:
Ken Gracey
604-899-6577
Public inquiries:
604-899-6854 or 1-800-373-6393 (toll free)
inquiries@bcsc.bc.ca<mailto:inquiries@bcsc.bc.ca>
Learn how to protect yourself and become a more informed investor at www.investright.org<http://www.investright.org/>
[logo]
Ken Gracey
Manager, Investor Education and Engagement
British Columbia Securities Commission
1200 - 701 West Georgia Street
Vancouver, BC V7Y 1L2
Tel: 604-899-6577
Fax: 604-899-6506
www.bcsc.bc.ca<http://www.bcsc.bc.ca/>
Email: kgracey@bcsc.bc.ca<mailto:kgracey@bcsc.bc.ca>
Find us on: Twitter<https://twitter.com/BCSCInvestRight> | Facebook<https://www.facebook.com/BCSCInvestRight> | YouTub
--->e<https://www.youtube.com/user/BCSCInvestRight>
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<p><span style="font-size:11.0pt;font-family:"Arial","sans-serif";color:#052C48"><a href="https://
--->www.bcsc.bc.ca/News/News_Releases/2018/77_CEO_and_mining_company_found_liable_for_false_or_misleading_statements/">htt
--->ps://www.bcsc.bc.ca/News/News_Releases/2018/77_CEO_and_mining_company_found_liable_for_false_or_misleading_statements/
---></a><o:p></o:p></span></p>
<h1 style="margin:0in;margin-bottom:.0001pt"><span style="font-size:14.0pt;font-family:"Arial","sans-se
--->rif";color:#052C48">CEO and mining company found liable for false or misleading statements<o:p></o:p></span></h1>
<p><span style="font-family:"Arial","sans-serif";color:black">2018/77 <br>
October 12, 2018<o:p></o:p></span></p>
<p><strong><span lang="EN-GB" style="font-family:"Arial","sans-serif";color:black">Vancouver</span
--->></strong><strong><span style="font-family:"Arial","sans-serif";color:black"> </span></strong
--->><span lang="EN-GB" style="font-family:"Arial","sans-serif";color:black">- </span><span style
--->="font-family:"Arial","sans-serif";color:black">A
British Columbia Securities Commission (BCSC) panel <a href="https://www.bcsc.bc.ca/Enforcement/Decisions/Mounta
--->instar_Gold_Inc__and_Brent_Hugo_Johnson__Findings_/" target="_blank" title="has found"><span style="color:#7E3141">has
---> found</span></a> that Brent
Hugo Johnson and Mountainstar Gold Inc. made repeated false or misleading statements in required public filings.<br>
<br>
The BCSC panel found that between December 2012 and December 2015, Mountainstar, a reporting issuer in B.C., made fals
--->e or misleading statements in its management discussion and analysis (MD&A) concerning certain Chilean mining clai
--->ms and related legal proceedings,
or Mountainstar omitted facts that were necessary to make the statements not false or misleading.<br>
<br>
Johnson was at all relevant times the president, CEO and a director of Mountainstar. The panel found that Johnson was
--->liable for Mountainstar's contraventions of the <em><span style="font-family:"Arial","sans-serif&q
--->uot;">Securities Act</span></em>, as he was clearly
aware of the filing of the MD&A in issue and had the ability to influence the content.<br>
<br>
The panel did not accept the respondents' argument that they had exercised due diligence in making the disclosure. The
---> panel found that the respondents' failed to "exercise the reasonable diligence required to find out whether the state
--->ments were false or misleading." <br>
<br>
The panel directed the parties to make submissions on sanctions according to the schedule set out in the findings.<br>
<br>
You may view the findings decision on our website, <a href="http://www.bcsc.bc.ca/"><span style="color:#7E3141">w
--->ww.bcsc.bc.ca</span></a>, by typing Mountainstar Gold Inc., Brent Hugo Johnson, or 2018 BCSECCOM 317 in the search box
--->. Information about disciplinary
proceedings can be found in the <a href="https://www.bcsc.bc.ca/Enforcement/"><span style="color:#7E3141">Enforc
--->ement section</span></a> of the BCSC website.<br>
<br>
Please visit the Canadian Securities Administrators' (CSA) <a href="http://www.securities-administrators.ca/disci
--->plinedpersons.aspx?id=74"><span style="color:#7E3141">Disciplined List</span></a> for information relating to per
--->sons and companies disciplined
by provincial securities regulators, the Investment Industry Regulatory Organization of Canada (IIROC) and the Mutual
---> Fund Dealers Association of Canada (MFDA).<br>
<br>
</span><strong><u><span lang="EN-GB" style="font-family:"Arial","sans-serif";color:black">About th
--->e British Columbia Securities Commission (</span></u></strong><span style="font-family:"Arial","sans-se
--->rif";color:black"><a href="http://www.bcsc.bc.ca/"><strong><span lang="EN-GB" style="font-family:"Arial"
--->;,"sans-serif";color:#7E3141;text-decoration:none">www.bcsc.bc.ca</span></strong></a></span><strong><u><span
---> lang="EN-GB" style="font-family:"Arial","sans-serif";color:black">)</span></u></strong><span styl
--->e="font-family:"Arial","sans-serif";color:black"><o:p></o:p></span></p>
<p><span lang="EN-GB" style="font-family:"Arial","sans-serif";color:black">The British Columbia Se
--->curities Commission is the independent provincial government agency responsible for regulating capital markets in Brit
--->ish Columbia through the administration of
the <em><span style="font-family:"Arial","sans-serif"">Securities Act</span></em>. Our missi
--->on is to protect and promote the public interest by fostering:</span><span style="font-family:"Arial","
--->sans-serif";color:black"><o:p></o:p></span></p>
<p><span lang="EN" style="font-family:"Arial","sans-serif";color:black">A securities market that i
--->s fair and warrants public confidence</span><span style="font-family:"Arial","sans-serif";color:bl
--->ack"><o:p></o:p></span></p>
<p><span lang="EN" style="font-family:"Arial","sans-serif";color:black">A dynamic and competitive
--->securities industry that provides investment opportunities and access to capital</span><span style="font-family:"
--->Arial","sans-serif";color:black"><o:p></o:p></span></p>
<p align="center" style="text-align:center"><span lang="EN-GB" style="font-family:"Arial","sans-serif&q
--->uot;;color:black">- 30 -</span><span style="font-family:"Arial","sans-serif";color:black"><o:p></o
--->:p></span></p>
<p><span style="font-family:"Arial","sans-serif";color:black">Media Contact:<br>
Ken Gracey<br>
604-899-6577<o:p></o:p></span></p>
<p><span lang="EN-GB" style="font-family:"Arial","sans-serif";color:black">Public inquiries:<br>
604-899-6854 or 1-800-373-6393 (toll free)<br>
</span><span style="font-family:"Arial","sans-serif";color:black"><a href="mailto:inquiries@bcsc.b
--->c.ca"><span lang="EN-GB" style="color:#7E3141">inquiries@bcsc.bc.ca</span></a><o:p></o:p></span></p>
<p><span lang="EN-GB" style="font-family:"Arial","sans-serif";color:black">Learn how to protect yo
--->urself and become a more informed investor at </span><span style="font-family:"Arial","sans-serif&
--->quot;;color:black"> <a href="http://www.investright.org/" target="_blank" title="www.investright.org"><span lang=
--->"EN-GB" style="color:#7E3141">www.investright.org</span></a><o:p></o:p></span></p>
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--->image005.png@01D4622B.A7630FF0" alt="logo"><span style="font-size:12.0pt;font-family:"Times New Roman","
--->;serif""><o:p></o:p></span></p>
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<p class="MsoNormalCxSpMiddle" style="margin-bottom:2.0pt;mso-add-space:auto"><b><span style="font-size:8.0pt;color:#1
--->F497D">Ken Gracey<o:p></o:p></span></b></p>
<p class="MsoNormalCxSpMiddle" style="margin-bottom:2.0pt;mso-add-space:auto"><b><span style="font-size:8.0pt;color:#1
--->F497D">Manager, Investor Education and Engagement<o:p></o:p></span></b></p>
<p class="MsoNormalCxSpMiddle" style="margin-bottom:2.0pt;mso-add-space:auto"><span style="font-size:8.0pt;color:#1F49
--->7D">British Columbia Securities Commission<o:p></o:p></span></p>
<p class="MsoNormalCxSpMiddle" style="margin-bottom:2.0pt;mso-add-space:auto"><span style="font-size:8.0pt;color:#1F49
--->7D">1200 - 701 West Georgia Street<o:p></o:p></span></p>
<p class="MsoNormalCxSpMiddle" style="margin-bottom:2.0pt;mso-add-space:auto"><span style="font-size:8.0pt;color:#1F49
--->7D">Vancouver, BC V7Y 1L2<o:p></o:p></span></p>
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<p class="MsoNormalCxSpMiddle" style="margin-bottom:2.0pt;mso-add-space:auto"><span style="font-size:8.0pt;color:#1F49
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<p class="MsoNormalCxSpMiddle" style="margin-bottom:2.0pt;mso-add-space:auto"><span style="font-size:8.0pt;color:#1F49
--->7D"><a href="http://www.bcsc.bc.ca/"><span style="color:#1F497D;text-decoration:none">www.bcsc.bc.ca</span></a><o:p></
--->o:p></span></p>
<p class="MsoNormalCxSpMiddle" style="margin-bottom:2.0pt;mso-add-space:auto"><span style="font-size:8.0pt;color:#1F49
--->7D">Email:
<a href="mailto:kgracey@bcsc.bc.ca"><span style="color:blue">kgracey@bcsc.bc.ca</span></a><o:p></o:p></span></p>
<p class="MsoNormalCxSpMiddle" style="margin-bottom:2.0pt;mso-add-space:auto"><span style="font-size:8.0pt;color:#1F49
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