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by Mike Caswell

The U.S. Securities and Exchange Commission has filed civil fraud charges against Vancouver's David Stephens, claiming that he and others were behind a $4.7-million scheme on the OTC Markets. (All figures are in U.S. dollars.) The SEC claims that he secretly acquired control of a supposed plastic chemicals listing and, with the help of others, boosted the stock to $18 through buying by an elderly investor. The elderly investor spent over $7-million acquiring shares on the market, the SEC says.

The allegations are contained in a civil complaint that the SEC filed on Sept. 30, 2022, in federal court in Los Angeles. In addition to Mr. Stephens, 66, the complaint names as defendants Donald Danks, 65, of Newport Beach, Calif.; Jonathan Destler, 58, of Los Angeles; and Robert Lazerus, 66, of Solana Beach, Calif. The complaint also lists two relief defendants, with those being Daniel Solomita, 46, of Quebec, and a numbered company that Mr. Solomita controls.

The case, as set out by the SEC, stems from a scheme with a listing called Loop Industries Inc., which had its office in the Montreal area. The SEC claims that Mr. Stephens acquired control of a shell that became Loop in 2014, with the deal giving him control over all of the company's tradable stock. According to the SEC, he hid his control by using 11 nominee entities that, on paper at least, appeared to be unrelated.

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