The OSC has always had their heads up their ass!
In 1991 I was working at Moss Lawson and Company in Toronto, Canada. I was very familiar with boiler rooms in the Toronto area. I knew that Lazer Friendly was being pitched by A.C. MacPherson, a very modern Toronto bucket shop. I knew that A.C. MacPherson sent out stock certificates to everyone that bought the stock from them(to keep the shorts away) so I went to the transfer agent after I had bought one share and taken delivery. This is the only way that you can see a list of all the shareholders. I was flabbergasted to find a "telephone book" of names. I went home and came back the same day with a camera. I proceeded to take pictures of every page. I had the film developed in extra large but still needed to purchase an industrial magnifying glass to copy all the name and addresses on to paper. I then started looking up all the phone #'s for these poor suckers. I proceeded to call them, one by one, and tell them what they were dealing with. What "from a principal position" meant and that they were dealing with crooks and they would lose money. The company had made the transition to the TSE from the Alberta Stock Exchange. I managed to pick up a few clients. At the time I was a rookie broker so every new account counted...bigtime! I then sent out a newspaper article on broker dealers and the way they do business to everyone on the list(some 800 names). The article mentioned E.A.Manning, Gordon Daly Grenadier, Norwich Securities, and, A.C. MacPherson. I stayed away from blocks since they were probably connected to the company. Within a week the president of my company called me in to the office and showed a registered letter from the lawyers of Lazer Friendly . It was a cease and desist letter. If I did not stop screwing up their market(by that time I was selling them back their stock every day), stop the mailings, write a letter of apology, and, the worst part...Moss Lawson did not write and send a letter to all shareholders saying that they thought it was a great stock, they would send "the facts" to the TSE and OSC and get us in big trouble. It threatened a lawsuit as well. Moss Lawson balked and assured Jack Banks that I would cease and desist but that the most they could do is send out a letter saying that they had no opinion on the stock...my name attached to it as well.
Taking names from a shareholders list is OK but you cannot mention the stock to them for 3 contacts(phone, mail, etc.). After 3 contacts with the shareholder you could finally mention Lazer Friendly. Obviously that was my downfault.
Two weeks after the letter, I was called by the Toronto Stock Exchange (along with the OSC) to be told that they had recieved a complaint from A.C. MacPherson and Lazer Friendly concerning me and a shareholders list. I went to meet with the TSE and explained how A.C. MacPherson worked and how Lazer Friendly was nothing but a scam. I had a personal letter from Dianne Francis, editor of the Financial Post, lamblasting the TSE and OSC for concentrating on me instead of shutting down A.C. MacPherson and Lazer Friendly. I was told by the TSE and OSC that while they understood what I was trying to do, I had broken the rules nevertheless. I was made to rewrite my Canadian Securities Course, take my Registered Representative exam again, put under supervision for 6 months, and given a fine of $3000.00.
As the fickle hand of fate would have it...I later was speaking to the nice man who sold me cigarretes in the store downstairs from my office and he wanted me to meet his son, an up an coming young securities lawyer. I met his son and somehow got on the topic of my ordeal with Lazer Friendly. He was shocked! He got on his cell and told the party on the other side of the line to come meet us...right now! His cousin showed up and shakes my hand and says "so you're the guy". Turns out he was a director of Lazer Friendly and had been to many meetings on how to deal with this Jackass! We had a laugh over it and he said he harboured no ill feelings and actually had a lot of respect for me for sticking my neck out(there was a lot of rumours that Lazer Friendly was connected to the Mafia). He proceeded to offer me all of the insiders' accounts. He said he would rather have me on the inside pissing out than on the outside pissing in! I turned him down by saying that I would simply be pissing in my house only from now on and left.
I haven't seen him since that day.
I didn't hear of Jack Banks & Co. until the current proceedings.
The OSC and TSE knew what the scoop was way back in 1991. They could have stopped it then. The stock skyrocketed to $13.00 after that.
The good thing is that I got to keep all the clients I got from that list and they were extremely loyal to me.
I would do it all over again in a second.
What a business! |
