Alberta finds Coastal Pacific Mining breached securities laws
In 2010, while Coastal shares traded on the U.S. over-the-counter market, Coastal initiated a campaign (comprised of near-daily news releases in conjunction with a concurrent promotional email campaign) that artificially stimulated investor interest in, and demand for, Coastal shares.
An ASC panel noted in its decision that the previously modest level of trading activity for Coastal shares "reached remarkable levels" during the promotional campaign, with trading volumes and prices crashing "to almost nothing" after the campaign.
The panel found that the capital market, including more than 12,000 unsuspecting investors who bought Coastal shares during the campaign, were misinformed and misled as to the merits of Coastal as a business enterprise.
In its decision, the panel stated: "This was a blatant market manipulation… it was obviously incompatible with a fair and efficient capital market, and dangerous for investors."
An in-person hearing will be convened in January 2017 to determine what, if any, orders ought to be made as a result of Coastal's misconduct.
In May 2011, the ASC issued orders freezing certain assets, some of which were related to Coastal's activities. In August 2013, the ASC also issued a Cease Trade Order against Coastal. These orders remain in effect. ■
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