AIM High

Having been burned with government bureaucrats running the Alberta Government Venture Capital fund (VenCap) it was sold off by the Ralph regime to Onex corporation in 1995.
It had potential, and even with a deficit its shares were worth $8 on the TSX. Which was not bad for the time. But the debt and defict hysteria led the government to sell off this potential golden goose.

In terms of publicly-funded venture capital funds, Alberta’s experience has not been positive. Vencap was established by the Alberta government with funding of $240 million and the objective of investing in venture capital. Vencap experienced many of the same problems as LSVCCs – a lack of good investments and a reluctance to take risks. As a result, a relatively small percentage of Vencap’s equity ended up in new Alberta ventures. The Alberta Opportunity Company faced similar problems in operating a program to support investments in start-up knowledge-based industries.

Yet its deficit was still underwritten by the Heritage Trust fund five years later, the Ralph regime was panic driven, selling off all government services it could at fire sale prices..

December 2000: All of the loans made to provinces from 1977 to 1982 have been paid back on time and without any missed payments. The only project loans left on the Heritage Fund books are Vencap and Ridley Grain Ltd. for a total of $98.8 million, which represents 0.8% percent of the Heritage Fund's total portfolio.

The Government is a risk averse regime that would rather underwrite private capitalists than use it's own capital.

Institutional investors key to growth of city's tech sector

Unlike other provinces and public pension funds, including the federal CPP, Alberta was more interested in selling off government assets and services to the private sector, than developing its capital base with the Heritage Trust fund and its other investment funds.

Risk adverse, wanting to divest itself of any economic responsibility, "we are not in the business of business", the government finally has realized it is a capitalist state and should be investing its social capital. However its social capital is not just the Heritage Trust fund, but public sector pension funds as well.

In a move predicted to earn up to an extra $500 million a year, the Stelmach government plans to create a new provincial Crown corporation to oversee $70 billion worth of financial assets.

The Edmonton-based investment powerhouse will be the fifth-largest pool of managed capital in Canada.

It would be exceeded in size only by the Caisse de depot et placement du Quebec ($143.5 billion), the Canada Pension Plan Investment Board ($111 billion), the Ontario Teachers' Pension Plan ($96.1 billion), and the B.C. Investment Management Corp. ($76.3 billion).

AIM Corp. would assume responsibility for managing the $16.3-billion Alberta Heritage Savings Trust Fund, several public endowment funds -- including the Alberta Heritage Foundation for Medical Research -- and a basket of public-sector pension funds.

The latter includes the $13.5-billion Local Authorities Pension Plan (LAPP), the province's largest public pension fund, and the $5.7 billion Public Service Pension Plan, among several others.

A recent study for the government concluded a stand-alone organization would be the best way "to achieve investment excellence," Alberta Finance said in a brief news release.

"The proposal follows best practices for top public sector investment funds such as the Canada Pension Plan, the B.C. Investment Management Corporation and the Ontario Teachers' Pension Plan."

During the Ralph regime everything not making money was sloughed off and contracted out or privatized. In order balance out the reduction in royalties and taxes coming in from the Oil industry, in the nineties the PC's found that like many governments they were carrying pension debt. As the third party to the Local Authorities Pension Plan(LAPP) which covers all MUSH employees and management in Alberta, they never contributed to the plan, rather like other governments they put all pension earnings into general revenues.

In the late nineties with a deficit and debt crisis, they looked at the debt they owed the LAPP and hived it off in plans to allow the contributors, employees and management as well as MUSH employers, to run it. Without of course the governments missing contribution. This left the LAPP in a deficit situation, causing its members to have to pay for the governments debt owed them.

In return for paying down the governments debt to the LAPP the members of the plan were offered investment autonomy, with moves to privatize the plan under membership control. Which was not a bad thing. It removed statist bureaucracy and red tape at a time when the market was booming, and as a fund managed by employee representatives from unions, management and professional associations, and employers. The board was in place, and hired its own CEO,and investment managers, as well as holding a series of input meetings with the membership, both for feedback and for an explanation as to how the funds would be managed.

In a short five years the LAPP was out of debt and the members actually paid less then was expected and in fact got a payback for overpayment's of the government debt. The reason? Bre-X. While the Bre-X swindle saw many make fortunes on the largest run of a penny stock to a $200 share in the shortest period in Canadian mining history, even for the mining scandals of the sixties, many also lost fortunes as the shares collapsed under the salting scandal that ensued. But not the LAPP they made money off Bre-X, and other investments. Because they were autonomous and now were no longer risk adverse, that is they were investing to make up the deficit, while maintaining the capital for their fiduciary responsibility to their retirees.

Once out of debt and making money, as they have for a decade, the government realized it was selling the golden goose if it allowed full autonomy, it reigned in its plans to privatize the LAPP. It remained under autonomous management but was still a subject to regulation by the Finance Department.

Had it been allowed full autonomy it would have made even more money. As it was with partial autonomy, and its own investment policies and managers it went from a deficit to $13. 5 Billion in assets.

Seeing it had a golden goose again, the Government has refused out right autonomy and has moved away from privatization of LAPP. Which may be the reason for it not wanting to talk about how it is looting public pension funds to underwrite its new investment corporation.

I almost missed it, but there it was, posted on the Alberta finance department's website.

The cryptic, one-page news release outlined a bill, introduced in the legislature Tuesday, to create a new provincial Crown corporation called Alberta Investment Management Corporation, or AIM Corp.

It will boast roughly $70 billion in assets.

That was it. There was no fanfare. No press conference. No grandiose quotes about the cosmic significance of this bold initiative from Alberta Premier Ed Stelmach, or Finance Minister Lyle Oberg. In fact, the latter didn't even respond to my followup call Wednesday. A department flack did.

The release itself was so blandly written it appeared designed to put reporters to sleep.

There is an irony here in that the ultimate capital partner in government P3 projects is not private hedge funds, nor private industry, but public pension funds. The Alberta government will find itself funding its own P3 projects with its new AIM Corporation. Just as governments world wide are being funded by Canadian institutional pension funds. And these same pension funds are crying about not having more government real estate and infrastructure projects in Canada to invest in.


See

P3

Your Pension Dollars At Work

P3= Public Pension Partnerships

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Alberta, Heritage Trust Fund, LAPP, Alberta Investment Management Corporation, Canada, Pensions, P3, public-private-partnerships, OMERS, CPP, Ontario-Teachers-Fund, OTF, Canada, investment, infrastructure, VenCap, shareholders, economics,

No Justice In Canada

There is no justice in Canada when it comes to war crimes or white collar crimes.

No charges to be laid in friendly-fire death of Canadian soldier

Bre-X case an "embarrassment" for Canadian law, says expert

Judge sets aside Mulroney ruling on $470000

Also See:

Friendly Fire

Scandal in the Alberta Stock Exchange

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Stock-Eschanges, Canda, economy, capitalism, Flaherty, Conservatives, Regulation, Stock-Regulation, SEC, TSX, Cornfeld, Bre-X, Skalbania, Lord-Black, crime, corporate-crime, corporation,
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Bre-X Redux

The Alberta Government is challenging the Federal government, their fellow Tories, over the proposed National Securities Commission. Like their failed gun registry challenge this is a waste of taxpayers money. The Alberta Sock Market along with its counter part in B.C. were a wild west show of rip offs during the eighties and nineties. While Alberta and Quebec protest a single national securities commission I would remind readers of the success of Alberta's Securities commission in protecting investors from rip offs, one little word; Bre-X.

Finally Some Common Sense

Federal Finance Minister Jim Flaherty will be discussing a single national Stock Exchange Regulator for Canada with Provincial Premiers at the Western Canadian Premiers meeting over the next few days.

It's about time, we have too many crooks at the trough with our provincially regulated exchange commissions. Which is why Bernie Cornfeld and IOS could take advantage of our under-regulated market back in the 1960's for his Mutual Fund Swindles. And we all remember Bre-X., And the lack of a single national regulator is why Nelson Skalbania could get away with pulling a stock swindle that would have seen him in jail in the US.

Without regulation capitalism is a criminal enterprize.With regulation it is just a little less criminal it follows the rules, sometimes, just ask Lord Black or Ken Lay.

Ontario securities official wants clarity in release of corporate salaries


Also See:

Criminal Capitalism

Criminal Capitalism: Xstrata

The Canadian Panama Mining Swindle

Scandal in the Alberta Stock Exchange

Calgary Fraud Funds Dubai Boom

The Joys of Telemarketing

Corporate Welfare Bums

Criminal Capitalism at Modblog


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Stock-Eschanges, Canda, economy, capitalism, Flaherty, Conservatives, Regulation, Stock-Regulation, SEC, TSX, Cornfeld, Bre-X, Skalbania, Lord-Black, crime, corporate-crime, corporation,

BRE-X SPECULATION!

Virginia Public Pensions Make a Direct Bet on Cryptocurrencies

WORKERS AND THEIR UNIONS NEED TO BE ON THE BOARD OF DIRECTORS 
Olga Kharif
Fri, September 10, 2021, 



(Bloomberg) -- A couple of Virginia public pension funds that first dipped their toes into the world of digital assets by investing in venture capital two years ago are at it again, and this time they are making a more direct bet on cryptocurrencies.

The Fairfax County Police Officers Retirement System and Fairfax County Employees’ Retirement System are planning to invest, pending board approvals, a total of $50 million in Parataxis Capital Management LLC’s main fund, which buys various digital tokens and cryptocurrency derivatives.

The outlays come on the heels of the Fairfax funds -- which together manage about $7.15 billion -- investing several times in Morgan Creek Asset Management funds, and, earlier this year, in crypto venture firm Blockchain Capital. While some of these investments ended up going into coins like Bitcoin, the majority was invested into technology startups, so Fairfax considered them venture-capital investments. Parataxis, with its focus on actual coins, is different.


“We think that there’s going to continue to be volatility in crypto, and this is going to be good for value traders,” Katherine Molnar, chief investment officer for the police officers retirement fund, said in an interview with Bloomberg News. “It’s an area that’s going to grow in adoption and interest. We think that it’s inefficient enough, so we think there are some alpha opportunities to take advantage of.”

While many pension funds and endowments are exploring cryptocurrencies, few besides Fairfax have publicly announced they are jumping in. Regulatory uncertainty and high volatility of the coins have been partly responsible for the hesitancy.

But that same volatility can lead to outsized returns, which have been one reason for Fairfax’s expanded investment. Molnar’s $1.95 billion police retirement fund was planning for 2% exposure to crypto via Morgan Creek and Blockchain Capital, but at the end of June crypto accounted for 7% of assets, due to appreciation, she said. Although Molnar couldn’t discuss exact appreciation, crypto “was not an insignificant contributor to performance” in the second quarter, she said.

While in recent months some companies such as MicroStrategy Inc. have begun investing their corporate treasuries into Bitcoin, Fairfax doesn’t want to invest into coins directly, Molnar said -- partly because there are still too few data points to draw conclusions from on whether Bitcoin can be likened to gold, for example, she said.

“Three years ago we weren’t comfortable making a bet on which cryptocurrency will rise to the top,” she said. “And I am not sure we are comfortable yet doing that today.”

Parataxis was started in 2019 by Edward Chin, previously an investment banker at Michael Novogratz’s Galaxy Digital Holdings, and by Thejas Nalval, a former portfolio manager with digital-asset hedge fund LedgerPrime and head of asset management at the Element Group. Parataxis has about $55 million in assets under management, Chin said. The two Parataxis funds invest in everything from Bitcoin to derivatives to DeFi coins such as MakerDAO. It plans to launch another fund.

“This is our first pension fund,” Chin said in an interview. “We are in conversations with a couple more, and a couple of endowments as well. It’s clear that people are trying to get exposure.”

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A WHIFF OF BRE-X ABOUT THIS

A Single Company Could Bring 1 Million Bitcoin Mining Rigs From China to Canada

By Nathaniel Mott 

The great Bitcoin migration

(Image credit: Shutterstock)

A single China-based mining operation reportedly plans to move 1 million Bitcoin mining rigs to Canada over the next 24 months with the help of a U.S. company.

The partnership between Optimum Mining Host (OMH) and Black Rock Petroleum Company (BRPC) could offer a glimpse at the scale of the mining operations being forced to leave China because of the country's restrictions on cryptocurrencies. Or it could be a sign that companies want to cash in on the uncertainty of Bitcoin's future.

BRPC said it plans to "host and operate up to one million Bit miners" for OMH "across three Natural Gas producing sites located in Alberta Canada." The first 200,000 units are set to be hosted at the Quirk Creek plant near Millarville, Alberta, and it seems that BRPC and OMH would split the costs of maintaining the devices

It's worth noting that, at least in our searches, mentions of OMH begin and end with this announcement. BRPC's website also relies exclusively on stock imagery, and founder Zoltan Nagy is also said to be "President and Principal Controlling Executive Officer" as well as "Financial & Accounting Officer, Treasurer, Secretary, Director.

BRPC is also listed on OTC Markets, which has more lax requirements than the likes of the New York Stock Exchange or NASDAQ, under the BKRP ticker symbol. But if the announcement was meant to buoy the company's share price, it didn't work. That price fell from $3.04 on July 15 to $2.26 at the time of writing and was declining even before the rest of the market crashed because of the Delta variant of COVID-19.

Even without this deal, there are signs that China-based Bitcoin mining operations plan to move to the U.S. and Canada in pursuit of cheap energy, privacy protections, and the relative stability of their regulations for cryptocurrency mining. There are also reports of miners planning to move hundreds of thousands of mining rigs.

Companies planning to move up to a million systems used for Bitcoin mining wouldn't be outside the realm of possibility, then, even if it's hard to fathom multiple operations devoting that much hardware to the cryptocurrency. Whether or not BRPC will be the first company to facilitate that great migration remains to be seen.

Cryptocurrency & Mining

1 million Bitcoin mining rigs being moved from China to Canada

Optimum Mining Host is moving 1 million Bitcoin mining rigs from China to ALBERTA, Black Rock Petroleum Company will help out.

Anthony Garreffa@anthony256

PUBLISHED MON, JUL 19 2021 

It seems the gigantic crackdown on cryptocurrency mining operations in China is going to the next level, with Chinese Bitcoin mining outfit, Optimum Mining Host, moving 1 million Bitcoin mining rigs from China to Canada.

Moving 1 million anything from one place to another is a gigantic operation no matter what it is, which is why the company is getting Black Rock Petroleum Company to help out. Moving all of that hardware out of China is going to be hard -- for many reasons, not just a logistics reason -- with the 1 million rigs being moved out of China and into Alberta, Canada spread out across 3 locations.

The new Alberta, Canada relocation will have the 1 million Bitcoin mining rigs will be spread across three Natural Gas producing sites. The first 200,000 machines will be hosted by the Quirk Creek Gas plant which is operated by Caledonian Midstream Corporation.

The companies signed a 24-month contract, with an optional 12-month extension available if required. The initial deployment of 200,000 Bitcoin mining rigs will be joined by 300,000 "near term" machines and then mid-term 500,000 immediately available once their new home in Canada is ready.

Maybe they're not Bitcoin mining machines and maybe most of the hash power used for "cryptocurrency mining" is really feeding into a huge AI... and that AI wants to have itself moved from China to Canada. Hah ;)

1 Million Bitcoin Mining Systems Could Be Headed To Canada From China


By Alex Casas
Jul 19, 2021


Bitcoin, the father of cryptocurrencies

The Chinese Bitcoin mining firm, Optimum Mining Host, is reportedly moving 1 million Bitcoin mining rigs all the way to Canada over the next 24 months with the help of the Black Rock Petroleum Company.

1 Million Bitcoin Mining Rigs Will Be Moved To Canada In The Next 24 Months

With China cracking down on cryptocurrency mining operations, many operations have already been shut down and are looking elsewhere. The two main reasons behind China's move to ban cryptocurrency mining operations are two have a carbon-neutral footprint and the People's Bank of China wants to move away from the volatile cryptocurrencies. In an official statement, the People's Bank of China said that:

Virtual currency trading activities disrupt the normal economic and financial order, breed the risk of illegal and criminal activities such as illegal cross-border asset transfer and money laundering, and seriously infringe on the property safety of the people.

Mining operations in certain regions have already been shut down and graphics card prices in China have begun to drop. The partnership between Optimum Mining Host and Black Rock Petroleum Company shows the great scale of mining operations that were previously operating in China as well as the trouble companies are going to have to go through to move all of the equipment out of China.



In the statement, Black Rock and Optimum Ming Host describe how many mining rigs will be utilized as well as where they will be located. 1 million mining rigs will be located across 3 sites in Alberta, Canada.


Caledonian Mainstream (“Caledonian”) is an Alberta-based company and the owner/ operator of 14 producing liquids-rich natural gas wells at Quirk Creek, Caledonian will become a wholly owned subsidiary of Black Rock upon completion of the recently announced transaction and Black Rock will utilise the site to host and operate up to 200,000 of the one million bit miners with 300,000 mining machines at a second site in Alberta and 500,000 at a third site to be identified shortly as negotiations are concluded.

The statement doesn't specify how the cost of operating all the bitcoin mining rigs will be split, but it seems as if the two companies will be splitting the cost. The linked statement goes over the agreement in its entirety.

A miner inspects a setup in Sichuan, China in September, 2016. (Image Credits: Chinafile)

Tom's Hardware also noticed that the Black Rock Petroleum Company website is very basic only uses stock imagery. The founder Zoltan Nagy holds both the "President and Principal Controlling Executive Officer" position as well as the "Financial & Accounting Officer, Treasurer, Secretary, Director" position. Both executives on the about us section of the website also do not have headshots and opted for a stock image.

It is certainly plausible to move 1 million systems to Canada from China, but whether or not it actually happens is another question. We will just have to wait and see for 24 months if the 1 million mining rigs have arrived in Canada.

Black Rock Petroleum Company Announces Bitcoin Mining Agreement

July 15, 2021 11:53 ET | Source: Black Rock Petroleum

BLACK ROCK PETROLEUM ANNOUNES BITCOIN MINING AGREEMENT TO OPERATE UP TO ONE MILLION BITMINERS TO BE DEPLOYED ACROSS THREE NATURAL GAS ENERGY PRODUCING SITES IN ALBERTA CANADA.

Los Angeles Ca , July 15, 2021 (GLOBE NEWSWIRE) -- Black Rock Petroleum Company (OTC:BKRP), a Nevada corporation (“Black Rock”), announced today it has entered into a binding agreement with Optimum Mining Host Limited Liability Co to host and operate up to one million Bit miners to be relocated from locations in China and exported to Canada by(OMH) to be deployed by BKRP, across three Natural Gas producing sites located in Alberta Canada with the first 200,000 units to hosted on site of the recently announced Planned acquisition by BKRP, the Quirk Creek Gas plant operated by Caledonian Midstream Corporation.

The contract term is 24-month contract with an optional 12-month extensions with prior notice. OMH will pay the fully loaded electrical supply costs. OMH will maintain different electronic payment term in account of the fully loaded electrical costs, around 2 cents (USD) or $55.55 (USD) per miner per month as wholesale price. Payments can be made in US Dollar (USD) or Canadian Dollar (CDN). OMH will pay the host and maintenance services fee of 2.19 cents (USD) or $60.00 (USD) per miner per month. For equipment installation, service, firmware updates, maintenance, and repair, BKRP will charge an Administrative and Management fee of 1.83 Cents (USD) or $50.00 (USD) per miner per month. Maintenance and repairs are limited to swapping hash boards, fans, or miner configuration changes as the normal course of business. OMH will provide and maintain an expected inventory of spare parts for the number of miners installed and replenished based upon known failure rate. OMH will pay the fee of 0.36 cents (USD) or $10.00 (USD) per miner per month, for the allocation of the host services OHM required to have including: OMH Authorized Chinese speaking technicians, OHM Authorized English/Chinese speaking technicians, and OMH Authorized 24-7 hi-level Armed securities guard with enforcement power. OMH will pay BKRP all in price extra 0.18 cents or $5.00 (USD) per miner per month Any provided equipment that is found to cause damage to the electrical infrastructure at the facility will be disconnected and the companies will work together to resolve the issue. If faulty equipment cannot be remediated within 15-days than BKRP will remove it from the network and OMH has the right to provide replacement devices for the term of the contract. The initial contract commitment is for 200,000 machines to be scheduled for deployment, plus near term 300,000 machines and midterm 500,000 immediately contract commitment when the host capacity is ready.

Caledonian Mainstream (“Caledonian”) is an Alberta-based company and the owner/ operator of 14 producing liquids-rich natural gas wells at Quirk Creek, Caledonian will become a wholly owned subsidiary of Black Rock upon completion of the recently announced transaction and Black Rock will utilise the site to host and operate up to 200,000 of the one million bit miners with 300,000 mining machines at a second site in Alberta and 500,000 at a third site to be identified shortly as negotiations are concluded.

Raw production at Quirk Creek has recently averaged approximately 12 MMcf/d, with natural gas sales averaging approximately 8.5 MMcf/d, approximately 475 barrels of natural gas liquids and 60 tonnes of molten sulphur per day. Total remaining recoverable natural gas associated with the Quirk Field are estimated at 49 Bcf on a proved plus probable producing basis.

The Quirk Creek plant is connected to the Plains Midstream Pipeline by a company-owned, 34-mile pipeline capable of transporting natural gas to market in Fort Saskatchewan Alberta, as well as the TC Energy Gas Transmission Pipeline, with routing through Southern Alberta, the interior of British Columbia and the Western United States, terminating in the Sacramento/San Francisco.

Zoltan Nagy, Chief Executive Officer of Black Rock, commented on the recent announcement, with the company entering the Bitcoin Mining and Hosting business in Canada, it joins publicly traded companies in this space like Riot Blockchain,(RIOT) Marathon Digital (MARA) and Argo Blockchain (ARGO) and Genesis Digital Assets the worlds largest bitcoin miner as a serious competitor achieved via its agreement with OMH, to provide one million bitcoin mining machines and that “Caledonian Midstream is a great fit for Black Rock, and as demand for natural gas continues to grow, in Alberta and across North America, and the Quirk Creek property is perfectly situated to service those markets. Current production levels are good, and our engineers have looked at the property’s historical production records and analysed recent reserve evaluations, and we are confident we have the expertise, technology and resources to materially increase production and, in turn, the cash flow of the site and to host and operate bitcoin miners at an energy cost of circa three cents Canadian per KWH.

ABOUT BLACKROCK PETROLEUM

Black Rock Petroleum Company is expanding and diversifying its operations by the acquisition of Caledonian Midstream that owns and operates the Quirk Creek Gas Plant in Alberta Canada and by entering the very lucrative and cash generative Bitcoin and Crypto Mining Sector via its agreement with (OMH) to host and operate up to one million bit miners in Alberta Canada, in addition to its existing oil and gas exploration-stage company in California.

To learn more about Black Rock Petroleum, please visit the website

www.blackrockdrilling.com

Contact:
Zoltan Nagy, CEO
(778) 814-7729
Zoltan@starflick.com

Source: Black Rock Petroleum Co./ Torrance Petroleum Co.

Safe Harbour Statement: This press release may contain certain forward-looking statements and information, as defined within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934; and is subject to the Safe Harbour created by those sections. This material contains statements about expected future events and/or financial results that are forward-looking in nature and as such are by definition subject to risks and uncertainties.

CANNABIS CAPERS

Court case against ex-CannTrust leaders should prompt OSC 'soul-searching': experts

Tara Deschamps , The Canadian Press

Legal experts say the acquittal of three former cannabis executives should prompt the Ontario Securities Commission to do some "deep soul searching."

The Thursday acquittal of ex-CannTrust Holdings Inc. chief executive Peter Aceto, chairman Eric Paul and vice-chair Mark Litwin came a day after the regulator revealed it no longer had a reasonable prospect of convicting the men on charges linked to alleged unlicensed cannabis growing at a Niagara area facility.

The trio, who pleaded not guilty in October, were each charged with fraud and authorizing, permitting or acquiescing in the commission of an offence.

Litwin and Paul were also facing insider trading charges, and Litwin and Aceto were charged with making a false prospectus and false preliminary prospectus.

Industry observers were eagerly anticipating the outcome of the matter — the OSC's first court case involving a publicly traded cannabis company — and Doug Sarro saw it as a way the regulator could change its perception. 

"The OSC had a reputation for a while for being weak on enforcement and this outcome doesn't help," said the lawyer and University of Toronto adjunct professor.

The regulator also lost an insider trading case against Bre-X Minerals Ltd. chief geologist John Felderhof in 2007.

In 2010, it settled a 1986 civil lawsuit filed on behalf of shareholders of real estate company Mascan Corp. after 24 years of litigation.

Sarro thinks the Thursday acquittals further entrenched the OSC’s reputation for court losses and should prompt the OSC to look more closely at how it handles cases.

"This was a really high-profile prosecution that was supposed to really change that perception, and clearly with this outcome, the OSC is going to have some soul searching to do,” he said.

The OSC declined to comment Friday, but referred The Canadian Press to a Thursday statement saying it was "considering the implications of the (court’s) decision and assessing its options.”

Rather than acquit the accused, the OSC had asked the court to withdraw its case, which would have allowed it to pursue charges against the men again.

Justice Victor Giourgas rejected the withdrawal ask, telling the OSC’s lawyers, “The law seems to be against you.”

The acquittal leaves the OSC few options to move forward on this case, though Sarro said the regulator could bring an administrative proceeding in front of the Ontario Capital Markets Tribunal, where jail time wouldn’t be possible but the accused could be banned from serving as a directors of public companies.

Like Sarro, University of Ottawa law professor Jennifer Quaid suspects the OSC’s next move is most likely a "deep soul-searching session" to address why it does not have a high rate of success, especially when compared with the more resource-laden U.S. Securities and Exchange Commission.

The outcome of the case against the ex-CannTrust leaders is “not a very flattering look for the OSC," she said.

"It won't help their reputation, that's for sure, because I'm pretty sure that the public interpretation of what happened is not going to be favourable to them,” she said.

In the years proceeding the case, CannTrust, which is now called Phoena Holdings Inc., admitted to partaking in “unlicensed” growing in at least one news release and after halting cannabis sales and shipments from the company, Health Canada suspended CannTrust’s license.

Yet the OSC's case still crumbled a few weeks into hearings, when Litwin's lawyer Scott Fenton cross-examined Graham Lee, a former CannTrust director of quality and compliance. 

Fenton presented Lee with documents showing the entire Niagara facility was licensed between 2017 and Sept 2019.

Lee testified the documents, which he was not shown by the OSC before court proceedings, did not include any restrictions on what rooms the company could grow pot in. 

Cross-examination also uncovered documents where CannTrust was seeking ministerial approval to add rooms where unlicensed growing was alleged to that licence. But in May 2020, Health Canada relieved cannabis producers of the need to get ministerial approval before using growing rooms.

Days after the cross-examination, the OSC announced it no longer had a reasonable prospect of convicting the men.

Observers felt a strong ruling in favour of the financial regulator would deter other pot companies from skirting the law and bring comfort to investors who lost money, when the unlicensed growing was revealed by the company in July 2019.

"Maybe (the OSC) felt that if they came down hard on people who didn't follow the rules, it would sort of send a message that 'hey, cannabis is not a free for all,'" said Quaid.

"It would have been powerful, if they had gone through a 50-day trial and got a conviction, but that's not what happened."

Are Income Trusts A Ponzi Scheme

One has to worry about Income Trusts in Canada. The reason is that this country has such poor regulations around capital and investments, that it is literally the wild west for all sorts of get rich quick schemes. Bre-X was not an anomaly but business as usual.

Globeinvestor.com: Building Bay St.

The Toronto Stock Exchange was established in 1861, with 24 members (who paid $5 each to belong), trading 18 securities during half-hour daily sessions held at a local Masonic hall. But much of the action shifted to the cross-town Standard Stock and Mining Exchange, which was formed in 1901 and became the North American capital for mining shares and stock swindles. The Financial Post estimated that 400,000 investors were bilked out of $100 million, before the S&M was merged into the slightly more respectable TSE in 1934.

One of Bay Street's first major reforms was a crackdown on wash trading (a practice that created the appearance of activity through the manipulation of fictitious accounts) following the 1964 Windfall Scandal. Viola MacMillan, a doughty prospector, used the technique for fraudulent promotion of Consolidated Golden Arrow Mines. But it was Windfall Mines, another MacMillan company, that triggered the uproar after she drove up the price of its shares from 65 cents to $5.60 without any underlying value in the summer of 1964. She was later sentenced to nine months in jail in connection with Golden Arrow, but served just eight weeks. Windfall wasn't that much of a scandal because so many mine promoters followed her example, but the royal commission formed to investigate the case nevertheless recommended trading reforms. MacMillan died in 1993 at 90, fully pardoned and the holder of an Order of Canada. (Lenny Gaudet, please copy.)

Corporate crime in Canada is big business,it is actually business as usual, and it has had historic international or at least cross border connections with the United States.

Al Capone operated out of Moosejaw, the Bronfmans supplied Capone with booze and then operated on their own. Capone was indicted for income tax evasion, the Bronfmans are corporate big wigs in the international Entertainment business.

Corprate crime in Canada is still all wink, wink, nudge, nudge. And while corporate crime is big in Canada, in fact it is a major export, such as the boiler room swindle of British MP and author Jeffery Archer. The Canadain legal system is like Siberia when it comes to dealing with it, out in the cold and in the dark.

Welcome to the world of white-collar crime. It's always been there, but perhaps you didn't notice. A lot of criminologists like to refer to 1940 as the year when criminology first noticed, when Edwin Sutherland drew attention to it, and defined it as "crime committed by a person of respectability and high social status in the course of his occupation." Sutherland's (1949) pioneering study of legal action against the seventy largest U.S. corporations found that all seventy firms in the sample had at least one formal action against them, and that the average number of violations per company was fourteen. A full 60% of the firms had been convicted in criminal court. Goff & Reasons (1978) found similar white collar crime patterns in Canada, and Clinard & Yeager (1980) found that nearly two-thirds of Fortune 500 companies come under fire at least once a year for federal regulatory violations and/or violations of corporate/criminal law.

WHITE-COLLAR AND CORPORATE CRIME OVERLOOKED

While over one-million charges were laid against street criminals in 1988, only 23 were laid against corporations in the first two years of the 1986 Competition Act. According to Holmes, the lenient treatment of non-violent crime has led to the growth of a "get-something-for-nothing attitude." Similarly, many corporations view the penalties for corporate crime as a Òmere cost of doing business."

Judges require better corporate crime education: Judicial training has historically keyed on blue-collar wrongdoing

Securities regulators should place greater emphasis on restitution for aggrieved investors and Canada should create specialized criminal courts specifically for white-collar crimes, according to a York-authored study cited in the National Post June 15. 2005

Not surprisingly, said the Post, her paper also reiterated the widely held view that when compared with their US counterparts, Canadian regulators do not engage in enough enforcement activity and are less effective when they do. To support her assertion, Puri cited statistics that showed Canadian securities regulators devote a smaller percentage of their total budget to enforcement than their US counterparts. As well, Puri found financial penalties are 10 times higher in the United States than the average Canadian fine.

Corporate and white-collar crime is not victimless. The harms caused by corporate misconduct can result in substantial injury to a broad range of stakeholders, as witnessed by recent accounting and corporate governance scandals at Enron and Worldcom. Shareholders can lose their retirement savings, employees their jobs, and creditors significant investments. Ernst & Young fraud investigator Don Holmes estimates that white-collar crime costs Canadians $20-billion a year. The Canadian judiciary needs to recognize not only the magnitude and impact of corporate misconduct on large segments of the population, but also the broader ramifications of corporate crime on the Canadian economy.

The judiciary has historically treated white-collar criminal offenders more leniently in sentencing than blue-collar offenders. Compare robbery and burglary to accounting fraud and embezzlement. Compare tax evasion under the Income Tax Act to fraud under the Unemployment Insurance Act. Compare traditional theft to misleading advertising. Existing studies reveal that white-collar offenders are less likely to be imprisoned and that they receive lower average sentences and serve less time.

I am currently reading a great book on the 1960's mutual fund rip off done by Bernard Cornfeld, the book is called Do You Sincerely Want To Be Rich. Cornfeld and his company IOS were operated out of Europe and registered on the American Stock exchange via Ontario. They were underwritten by the Royal Bank of Canada. They sold mutual funds, and created a super fund of mutual funds which was really composed of lots of mini mutual funds that IOS created. When the market crashed in 1970 their swindle was revealed. Bernie retired to Hollywood to live with Hedi Fleiss, the Hollywood Madame.

Beautifully engraved Certificate from the Investors Overseas Services issued in 1969. This historic document was printed by the Canadian Banknote Company and has an ornate border around it with a vignette of of a semi nude female sitting in front of an major industrial facility above the company's nototious logo. This item has the printed signatures of the company's officers including Bernard Cornfeld as President and is over 34 years old. There are 32 unused coupons attached to the bottom of this certificate not shown in the scan.

Robert Vesco

Another notrious crook took over IOS, Robert Vesco. Vesco ran a variety of financial black market operations including involvement with the U.S. Military and the spook (spy) community. He like Bernie also operated out of Canada for a while.




Sep. 19, 1983 The New Jersey financier fled the U.S. in 1972 after being indicted on charges that he looted $224 million from the Geneva-based Investors Overseas Services Ltd., and illegally donated $200,000 to Richard Nixon's re-election campaign. Since then Vesco has lolled in exile in the Caribbean, apparently in the Bahamas, safe from extradition efforts.

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A Valhalla of the Vile/Here are the Felon Index rankings:

	Scammer	$mm (adjusted for inflation)	years served in prison	Felon Index Score
1.	Bernie Cornfeld (1970)	$2,305	0.92	2,514.5
2.	Michael Milken (1986)	$1,630	3	543.3
3.	Tino De Angelis (1963)	$1,170	7	167.1
4.	Stanley Goldblum (1973)	$1,209	8	151.1
5.	Ivan Boesky (1986)	$163	1.83	89.1
6.	Barry Minkow (1989)	$151	5	30.2
7.	Charles Ponzi (1920)	$ 17.9	5	3.6

The accounting firm Arthur Anderson, who also advised Mike Harris and his Ontario government about privatization schemes for work for welfare, was caught in the Enron scandal. But Wall Street knew about Andersons peccadillo for shady accounting. They had been Bernie Cornfelds IOS accounts back in the 1960's!

Enron and World Com were well connected with Bay Street and Canada's banking industry, CIBC the Royal Bank both had to bay out billions last year in fines for their involvement in the great dot.com swindle. And remember the Royal Bank underwrote Cornfelds IOS Fund of Funds back in the sixties.

Today CIBC is passing off its costs of fines for being a criminal onto its bond holders.
Bondholders warned to beware getting the short end of the stick

Then there are our own rip off artists, Nelson Skalbania and Peter Pocklington who profited during the wild boom and bust of the 1980's, taking advantage of the unregulated Alberta and B.C. stock market. They swindled investors, screwed workers, ripped off governments, and in the case of Pocklington never went to jail. Skalbania spent some time in jail, certainly less than an average street criminal. And once out was allowed to continue trading on the stock market in Canada.

Alberta is home to the Income Trust business in Canada. It originated in the petro-towers of Calgary. The first Canadian income trust was a petro trust. Modeled on the American Trusts, they have managed to become a tax haven because of loose or non existant tax rules.

Marcel Tremblay, inventor of Canadian income-trust structure, dies at 64

A bold business leader with more than 40 years of experience in Canada's investment-management and energy industries, Tremblay is best known as the inventor of the income-trust structure in Canada.

Tremblay designed and created Canada's first income trust, Enerplus Resources Fund, in 1986, spearheading a sector of the Canadian economy that now represents over 15 per cent of the market capitalization of the Toronto Stock Exchange.

"Convincing the brokerage community that this idea made sense was an almost impossible task," Tremblay told The Canadian Press in 2004.

"My objective was always to give investors the best return possible, minimize the taxation issues, preserve capital as much as possible and make sure they participate in the upside."

The effect that income trusts have had on the Canadian business landscape is dramatic, to say the least.

Income trusts are now the fastest-growing sector of Canadian capital markets because of their sizable distributions of income to unitholders and their considerable tax advantages over a standard corporate structure.

It is finally after all the political debate this past year a business that is now under the scrutiny of Standard and Poors in the U.S.

Obscure income trust reports can mislead investors: S&P

The two analysts said income trust reports are so obscure, and so full of distortions, they can easily lead investors astray. To make it worse, key information is often missing.

"Coupled with insufficient and inconsistent disclosure by management, the information risks inherent in this area of the Canadian capital markets continue to be quite significant," S&P said.

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This is far more important an investigation than who leaked the Income Trust announcement. Though the profiteering off that announcement is an iconic metaphor for the shady nature of Income Trusts. Just as their name says it all, hiding income from the tax man

Also see:
Income Trusts
Corporate Welfare Bums
Criminal Capitalism
Crime



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