16:59:22 EDT Thu 30 Mar 2023
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BCSC finds against West Van's Johnston, Stock Social

2023-01-31 20:48 ET - Street Wire

Also Street Wire (C-IP) ImagineAR Inc

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by Mike Caswell

The B.C. Securities Commission has ruled that Stock Social Inc., an investor relations company that relied on social media "influencers," broke the rules with materials it distributed touting five listings. The materials, which were "singularly positive," failed to properly disclose that they were part of a paid promotion. Stock Social's largest customer, Canadian Securities Exchange listing MGX Minerals Inc., paid $408,300 along with a $40,000 (U.S.) fee for the touting, the BCSC says.

The findings are contained in a decision that the BCSC released on Tuesday, Jan. 31. They apply to Stock Social as well its president, West Vancouver resident Kyle Alexander Johnston. There are no fines or other sanctions, as the BCSC will hold a separate hearing to determine the appropriate penalties.

The case, as set out by the BCSC, centres around investor relations work that Stock Social did for five companies from August, 2016, to March, 2018. It prepared advertising that went out through several websites, generally written in the style of a news article, the BCSC said. The problem, at least according to the BCSC, was that the material failed to clearly state that it was advertising. (Such disclosure is mandatory for promotional material in most jurisdictions.)

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