Interesting about manipulationof stock prior to priceing a placement... i quess the BCSC dosen't watch this type of stuff anymore.... or they have blinders on ...LOL
----------------------------------------------------------------------
BCSC gets to keep its investigations dark and secret
2007-07-24 14:52 ET - Street Wire
by Stockwatch Business Reporter
The B.C. Supreme Court has ruled that the B.C. Securities Act is constitutional. Howard Shapray, a Vancouver lawyer, had challenged a section of the act forbidding a witness in a B.C. Securities Commission investigation from telling anyone, except his lawyer, that he had given information to the regulator or what questions the BCSC had asked him. Mr. Justice Jon Sigurdson ruled that, while the section was an infringement of a person's right to freedom of expression, the law was a reasonable limit on that right. Mr. Shapray disagrees with the judgment and plans to appeal the decision. He says, "I am thoroughly convinced [the law] shouldn't be in any statute book in a democracy."
The Smolensky case
Mr. Shapray first objected to this provision of the Securities Act during protracted litigation between the BCSC and Arthur Smolensky, the chairman of Global Securities Corp. In 2002, the BCSC accused Mr. Smolensky of manipulating the price of Trooper Technologies Inc. to get a better price in a private placement. Mr. Smolensky had already settled with the Vancouver Stock Exchange, which had accused him of the same thing, and he thought it was unfair for the BCSC to try him too.
He unsuccessfully sought to have the B.C. Supreme Court quash the BCSC hearing, and was also unsuccessful when he appealed to the B.C. Court of Appeal and the Supreme Court of Canada. Then, in 2006, with the BCSC's right to hold a hearing finally indisputable after four years in court, it dropped its case without an explanation.
Secret investigations
The contentious section of the Securities Act prohibits any person summoned to give information to the BCSC during an investigation from telling anyone, except his lawyer, that the commission has summoned him or what he told the BCSC, unless the commission gives him permission. If he even tells his wife, he faces a fine of up to $3-million and a jail term of up to three years.
The purpose of this extraordinary secrecy, according to Martin Eady, the director of the BCSC's corporate finance division, is to protect investors and the marketplace. In an affidavit, he says that when the public finds out about a BCSC investigation, a company's stock price often drops and the trading volume often rises because of the news.
Unlike the police, however, the BCSC often investigates innocuous-seeming activity. Its investigation may reveal that a simple trade was simply that: a trade, and not insider trading. The BCSC cannot be sure until after it completes its investigation.