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by Mike Caswell

The Ontario Securities Commission has imposed a permanent ban and a $2.5-million fine on Ontario's Troy James Hogg for a scheme involving tokens supposedly backed by $10-billion (U.S.) worth of gold. The OSC said that Mr. Hogg was behind the Arbitrade Ltd. fraud, in which he touted the company as having "full title" to 395,000 kilograms of gold bullion. He and others raised $51-million (U.S.) based on the arrangement, but nobody ever verified that the underlying gold existed, the OSC found.

The penalties for Mr. Hogg are contained in a decision that the OSC released on Dec. 20, 2024. The OSC has permanently barred Mr. Hogg from being a director or officer of any company. In addition to the $2.5-million fine, he is liable for disgorgement of $17.9-million (U.S.) in gains. One of his companies, Arbitrade Ltd., must pay a $2-million fine and must disgorge $41.6-million (U.S.).

The penalties come as part of Mr. Hogg's sale of a cryptocurrency called DIG, or Dignity. He and others raised $51-million (U.S.) selling the tokens, but did so based on fraudulent representations about the gold bullion, the OSC said. According to the regulator, Mr. Hogg diverted investor money for his own use, buying crypto mining rigs and sending money to a lawyer who handled real estate transactions on his behalf.

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