SEC permanently bans Valentine
2006-04-21 15:17 ET - Street Wire
by Stockwatch Business Reporter
The U.S. Securities and Exchange Commission, Canada's top penny stock regulator, has permanently banned Mark Valentine, 35, the former chairman of bankrupt brokerage Thompson Kernaghan & Co. Mr. Valentine did not contest the ban.
The ban is the final prosecution against Mr. Valentine arising from Operation Bermuda Short, the massive sting operation in which the FBI and RCMP arrested 58 penny stock players on both sides of the border.
The ban has little bearing on Mr. Valentine in the short term, because he was already barred from the markets as a condition of his probation from his 2004 Bermuda Short prosecution.
Mr. Valentine is remembered, perhaps not fondly, for taking TK on a roller coaster ride that ended with the brokerage's demise in 2002.
Joining TK in 1994 after two years at BMO Nesbitt Burns, Mr. Valentine, a big producer, quickly moved up the command chain. Riding the tech boom of the late 1990s, he pushed out the old management and eventually took control of TK. He moved it from its stodgy old headquarters to a flashy new Bay Street office and opened branches in Calgary and Vancouver.
Mr. Valentine's success was short-lived. The tech boom ended in 2000 and police arrested Mr. Valentine in Germany in 2002 as part of Bermuda Short.
TK's 200 employees fled to other firms as the Ontario Securities Commission started investigating Mr. Valentine's trading. In July, 2002, the Canadian Investor Protection Fund petitioned the firm into bankruptcy.
In the Bermuda Short prosecution, Florida prosecutors said Mr. Valentine tried to pay a secret kickback to an FBI agent posing as a crooked fund manager. Mr. Valentine apparently tried to bribe the fund manager into buying overpriced shares of three companies, C-Me-Run Inc., SoftQuad Software Inc. and JagNotes.com Inc.
Mr. Valentine pled guilty to the charges in March, 2004, and received four years of probation.
The SEC is still seeking a penny stock ban for Mr. Valentine's co-accused in Bermuda Short, Paul Lemmon. In Bermuda Short, Mr. Lemmon pled his way to a reduced sentence of five months of home detention. He agreed to testify against Mr. Valentine, likely a factor in Mr. Valentine's subsequent guilty plea.
The SEC has banned most of the Canadians caught in Operation Bermuda Short. The list includes Calgary resident Doug Rasberry, Toronto residents Barry Berman and Howard Kerbel, and Rhino Ecosystems promoters Charles Cini and Gordon Novak.
With Mr. Valentine's ban, the only Canadian facing SEC action from Bermuda Short is Mr. Lemmon. Mr. Valentine, who is on probation until 2008, no longer appears to work in the brokerage industry. |
