The securities regulator of B.C. has permanently banned a Victoria man from the province’s capital markets after he defrauded a family friend by purporting to sell her shares he never owned.
Larry Keith Davis of Victoria was banned from trading in securities in B.C. and ordered to pay a $15,000 administrative penalty for misconduct, a B.C. Securities Commission panel wrote in a decision issued last week.
In July, the commission found Davis committed fraud in 2011 and 2012 when he purported to sell shares in a U.S.-based company, for a total of $7,000, to a neighbour and family friend with “almost no prior investment experience,” even though, as he admitted at his hearing, he never owned shares in the company.
Davis instead “treated the (investor’s) funds as his own and used them within a short time of their receipt to pay his personal expenses,” the panel wrote in its decision. The investor eventually pursued Davis in small claims court and recovered her money.
Davis had previously worked in investor relations, the BCSC said, but has never been registered to sell securities. He is now banned from trading in and purchasing securities, acting as a director or officer of any registrant, and engaging in investor relations activities.
In its sanctions decision, the BCSC wrote “while the amount involved in this case is relatively small, the respondent’s initial and ongoing deceit” represented serious misconduct.
The panel wrote: “The investor was negatively impacted in other ways by her investing experience with the respondent. She testified that she has not invested since this experience, has lost trust in people and has had to seek counselling over the experience.”
