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by Mike Caswell
The B.C. Securities Commission has settled the case it was pursuing against Beleave Inc., one of many Canadian Securities Exchange companies named in an investigation over abusive share issuances. The BCSC and Beleave have entered into a settlement agreement in which Beleave has admitted to that it issued $7.5-million worth of shares to consultants who provided no services. The BCSC, citing a change of management, has ended the case against the company without imposing any penalties.
The settlement comes as part of an investigation in which the BCSC cited a large group of people and companies for illegal share distributions on the CSE. The BCSC said that the group misused exemptions normally reserved to issue shares to consultants. The matter is still in the preliminary stages, and the BCSC has not begun full proceedings against anybody. So far, the regulator's efforts have been limited to imposing temporary orders to halt the scheme.
When it filed the case, the BCSC cited Beleave and 10 other CSE listings. The regulator did not provide any details of Beleave's part in the scheme (or many details at all), but the settlement agreement released Wednesday fills in some of those details, at least with respect to Beleave. The company has admitted that it issued millions of shares to a group of consultants who provided no services. Between April and June, 2018, the company announced that it had raised $10-million through two private placements. What the company failed to disclose was that it only retained $2.5-million of the money, returning $7.5-million to the purported consultants as prepaid fees.
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