Canada’s BCSC accuses delisted crypto investor BLOK of misrepresentation

Rick Steves

All the abovementioned executives have all since left the firm and the BCSC’s allegations have not yet been proven as the investigation is ongoing. 

The British Columbia Securities Commission (BCSC) has accused Vancouver-based blockchain technology investment company and three of its officers of making a misrepresentation about the sales of its shares, thus violating the Securities Act as BLOK traded on the Canadian Securities Exchange.

In 2018, BLOK Technologies announced it had raised approximately $5.4 million through a private placement, but did not disclose that it had already spent or owed approximately $4.4 million on consulting fees. As a result, BLOK would only retain approximately $950,000, which is less than 18 per cent of the amount raised.

According to the regulator, Robert Earle Dawson, BLOK’s president and CEO; James Joseph Hyland, its vice-president and director; and David Malcolm Alexander, its chief financial officer, authorized, permitted or acquiesced in the company’s misrepresentation and therefore also violated the Act.

Robert Earle Dawson, aka Rob Dawson, left in January 2019 and is currently Chief Executive Officer at IOVIA, a “consumer participation company”.

All the abovementioned executives have all since left the firm and the BCSC’s allegations have not yet been proven as the investigation is ongoing.

BLOK is “a public company that invests in and develops companies in the blockchain and emerging technology sectors”, according to its own description. The firm was delisted from the CSE in October 2020.

Alleged Misconduct

In a June 8, 2018 news release, BLOK announced that it had raised a total of $5,403,384 through a private placement. BLOK stated that the net proceeds would be used for advancing the company’s current blockchain investment projects, evaluating new blockchain opportunities, and for working capital purposes.

BLOK did not disclose that it would retain only $947,321.50, or less than 18%, of the amount raised because it had already spent or owed $4,456,062.50 on consulting fees.

By announcing the total proceeds from the private placement but failing to disclose that it would retain less than 18%, BLOK made a statement to investors that it knew, or ought reasonably to have known, was a misrepresentation contrary to the Securities Act.

Read this next

Retail FX

Plus500 Forex Garners Market Attention In The Latest Expert Ranking

Plus500 has garnered an impressive market attention during the Traders Union Best Forex Brokers of 2023 ranking. The platform ranked 58th among 350 companies evaluated by TU experts, with an overall score of 6.3 out of 10.

Digital Assets

Coinbase CEO says Chase UK’s ban on crypto “totally inappropriate”

Coinbase CEO Brian Armstrong criticized Chase UK’s decision to restrict cryptocurrency-related transactions in the UK. He called the move “totally inappropriate” and expressed his disagreement with the bank’s decision to ban its UK customers from conducting debit card or wire transfers related to cryptocurrencies.

Digital Assets

Binance CZ refutes any connection with CommEX

Changpeng “CZ” Zhao, the founder and CEO of Binance, has denied being the owner of CommEX, the company that reportedly acquired Binance’s business in Russia.

Institutional FX

Refinitiv’s spot FX volumes hit 8-month low

Refinitiv, the former Financial and Risk business of Thomson Reuters, today reported that the average daily volumes (ADV) of currency trading were $424 billion last month on the company’s main FX trading services.

Executive Moves

Integral hires industry veteran Paul Arnold as liquidity manager

Integral, a technology provider to the financial markets’ buy-side, has appointed Paul Arnold, a highly experienced FX industry professional, as its liquidity manager, according to information made public on his Linkedin profile.

Digital Assets

Terraform’s Do Kwon challenges US extradition request

Do Kwon, the crypto entrepreneur and former CEO of Terraform Labs, is opposing the U.S. Securities Exchange Commission’s request to question him about the crash of his company’s stablecoins Terra and Luna.

Digital Assets

Coinbase gets nod to offer futures for retail customers

Coinbase International Exchange has received regulatory approval from Bermuda’s financial regulator, the Bermuda Monetary Authority (BMA), to allow eligible non-US retail customers to trade perpetual futures contracts.

Inside View

How brokers can win the trading tech wars: Insights from iFX EXPO 2023

Last week’s iFX EXPO International 2023, held at the City of Dreams Mediterranean Integrated Resort in Limassol, Cyprus, welcomed a series of insightful discussions. A panel that particularly stood out focused on the role and evolution of trading technology.

Crypto Insider

Web3 Transformation: Radix’s Babylon Update Redefines User and Developer Engagement

Radix Publishing leaps forward in the decentralized world with the release of the Babylon mainnet upgrade, bridging the gap between innovative tech and user-friendly DeFi experiences.