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by Mike Caswell
The U.S. Securities and Exchange Commission has filed civil fraud charges against Vancouver's Steve Bajic and others for a scheme that involved the co-ordinated dumping of stock in at least 45 public companies. The SEC says that Mr. Bajic helped others unload $35-million worth of shares in illegal sales over a four-year period. (All figures are in U.S. dollars.) Among other things, he provided a "layer of disguise," allowing those behind the companies to secretly sell their stock, the SEC claims.
The allegations are contained in a civil complaint that the SEC filed on Thursday, Jan. 2, in federal court in New York. The complaint identifies Mr. Bajic, 49, as a dual citizen of Canada and Croatia. The other defendants include Rajesh Taneja, 43, a Canadian living in Vietnam, and Christopher McKnight, 45, a Canadian who arranged for paid promotional materials. Also named are several private entities, mostly incorporated overseas.
The scheme, as set out by the SEC, involved Mr. Bajic and Mr. Taneja setting up a network of offshore entities that could hold shares in public companies. Using those entities, the men were able to conceal control positions of insiders, the SEC claims. They typically did this by dividing up an insider's holdings between several entities, so that none would have holdings above the reporting threshold of 5 per cent. According to the SEC, this arrangement effectively allowed the men to accept large blocks of shares in public companies and secretly sell the stock. In this manner, they dumped $35-million worth of shares, the SEC says.
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