B.C. regulator alleges North Vancouver man engaged in insider trading
British Columbia's securities regulator is accusing a North Vancouver man of failing to disclose material information about a company for which he was an executive, as well as engaging in insider trading.
The allegations from the executive director of the B.C. Securities Commission against Mark Morabito and his former company Canada Jetlines Ltd. have not been proven. The executive director will present his evidence at a hearing to be scheduled next month.
The commission outlined the allegations against Morabito in a news release Friday, saying that the North Vancouver resident was the executive chairman and a director of Canada Jetlines in September 2017, when the company announced that it had entered into a letter of intent to lease two aircraft.
The announcement stated that the planes would be delivered in April 2018, and that the ultra-low-cost airline would begin flight operations in June of that year.
According to the BCSC, the letter of intent was terminated in December 2017, "after Canada Jetlines tried unsuccessfully to extend the payment terms."
The termination was a "material change" to the company's situation, and it led to a delay to the start of flight operations, another material change, the commission said.
Canada Jetlines did not make the news of either of these changes public until three months after they occurred, a delay the commission said constitutes a violation of the B.C. Securities Act.
When the company published news of the termination and delay on March 13, 2018, its stock price decreased by 38 per cent over two days, according to the BCSC.
During the period between the termination of the letter of intent and the public release of that information, the commission alleges that Morabito transferred 352,945 shares of the company to his spouse, with the knowledge that the shares would be sold.
The BCSC alleges that this transfer of shares constituted insider trading.
According to the commission's notice of hearing, Canada Jetlines' share price was $1.42 before the March 13 announcement. By March 15, it had fallen to 87 cents.
The commission does not cite a specific dollar amount of material gain from the alleged insider trading. However, the commission's numbers indicate 352,945 shares would have been worth more than $500,000 on March 13, 2018, and would have been worth just over $300,000 two days later.
CTVNews.ca Top Stories
Canadian gov't proposes new foreign influence registry as part of wide-spanning new bill
Prime Minister Justin Trudeau's government is proposing a suite of new measures and law changes aimed at countering foreign interference in Canada, amid extensive scrutiny over past meddling attempts and an ever-evolving threat landscape.
Boeing Starliner capsule's first crewed test flight postponed
The long-awaited first crewed test flight of Boeing's new Starliner space capsule was called off for at least 24 hours over a technical issue that launch teams were unable to resolve in time for the planned Monday night lift-off.
Teacher charged in historical sexual assault of Calgary teenage girl
Calgary police have charged a teacher with the alleged sexual assault of a teenage girl more than 20 years ago.
Winnipeg man admits to killing four women, argues he's not criminally responsible
Defence lawyers of Jeremy Skibicki have admitted in court the accused killed four Indigenous women, but argues he is not criminally responsible for the deaths by way of mental disorder – this latest development has triggered a judge-alone trial rather than a jury trial.
Man banned from owning animals after fatal Calgary dog attack
The owner of three Calgary dogs that got loose and mauled a woman to death in 2022 has been ordered to pay a $15,000 fine within one year and banned from owning any animal for 15 years.
East-end Ottawa family dealing with massive rat infestation
Residents in Ottawa’s Elmridge Gardens complex are dealing with a rat infestation that just won’t go away. Now, after doing everything they can to try to fix the issue, they are pleading with the city to step in and help.
Mediterranean staple may lower your risk of death from dementia, study finds
A daily spoonful of olive oil could lower your risk of dying from dementia, according to a new study by Harvard scientists.
An El Nino-less summer is coming. Here's what that could mean for Canada
As Canadians brace themselves for summer temperatures, forecasters say a weakening El Nino cycle doesn’t mean relief from the heat.
Newfoundland and Labrador latest province to tighten rules on Airbnbs
Newfoundland and Labrador is the latest jurisdiction to bring in stricter rules for short-term rentals, with a coming set of regulations that will force operators to register with the provincial government.