THOMSON KERNAGHAN & CO. LTD.– TIME TO GIDDY-UP AND GO
stockpatrol.com
“Giddy-up. Let’s get going,” is how former Thomson Kernaghan Chairman Mark Valentine used to exhort his trading team. Now Valentine is gone, banished by the brokerage firm on June 13th, and later suspended by Canada’s Ontario Securities Commission (OTC). See Not Exactly Valentine’s Day and On the Mark.
Thomson Kernaghan & Co. Ltd. isn’t far behind. The brokerage firm that helped finance Infotopia, Inc. (Pink Sheets: IFTA), Joshua Tree Construction, Inc. (OTCBB: JTRE) and a lengthy list of other over-the-counter companies, was suspended by the Investment Dealers Association of Canada (IDA) on July 11th and placed under bankruptcy protection one day later.
The IDA suspended Thomson Kernaghan after discovering that the firm, which had run out of capital, no longer had sufficient cash “to ensure that securities transactions could be completed promptly and effectively.” Spurred on by this discovery, on July 12th the Canadian Investor Protection Fund obtained an order from the Ontario Superior Court appointing Ernst & Young as trustee in bankruptcy for Thomson Kernaghan.
These latest events began to unfold as Thomson Kernaghan was winding down operations and transferring customer accounts to other firms. The firm’s demise followed charges by the OTC that Valentine had created “a culture of conflict and non-compliance” at the brokerage through a series of complicated investments.
Valentine, whose questionable activities allegedly included his involvement in so-called “death spiral” financing for struggling companies, was initially suspended from trading securities on June 18th. That suspension now has been extended until January 31, 2003. Until then, he is barred from trading any securities, except for stocks listed on the New York Stock Exchange and the Toronto Stock Exchange that he trades for his own account. That means he can’t dabble in NASDAQ and Over-The-Counter stocks, which have been the focus of his questionable activities. (7/15/2002) |
