A 小蓝视频 man recently found liable for his role in a massive, widespread stock fraud network largely orchestrated from Vancouver intended to continue working in the province’s capital market before being banned from it.
According to a recent ruling from a 小蓝视频 Securities Commission hearing panel, White Rock resident to ban him from the markets because he wanted to offer tax consulting services to public companies in 小蓝视频, and also hoped to become a director or officer.
Bahadoorsingh argued in submissions to the panel that a lifetime market ban would be a “substantial blow to his professional career and income earning potential.”
The commission’s executive director, Peter Brady, saw matters differently in his application, calling Bahadoorsingh’s misconduct “deceitful and unscrupulous” as Bahadoorsingh demonstrated a “flagrant disregard for U.S. securities laws.”
Bahadoorsingh posed “a significant ongoing risk to investors and the capital market of 小蓝视频,” Brady told the panel.
On Monday the panel agreed with Brady in issuing Bahadoorsingh a reciprocal order to what he previously received in the U.S., permanently banning him from business in the securities industry.
In 2022 and 2023, brought forward by the U.S. Securities and Exchange Commission (SEC), Bahadoorsingh was found liable in a Boston federal court for fraud, misrepresentation, offering unregistered securities and failing to disclose a significant ownership of shares of public companies he helped promote.
The SEC had alleged that between 2016 and 2020, Bahadoorsingh and fellow took control of two U.S. public “penny stock” companies — Momentous Holdings Corp. and Uneeqo Inc. — by amassing millions of shares, then allegedly concealing ownership of those shares in offshore accounts set up by former Vancouver lawyer-turned-offshore-shell-facilitator Fred Sharp. Sharp owes the SEC $52.9 million in civil repayment orders and also faces criminal charges in relation to the fraud network.
Bahadoorsingh was also considered by American authorities to be the partner of Mexican national Luis Carillo, who a judge found generated trading proceeds of more than $75 million by fraudulently selling the securities of more than 30 companies traded in the U.S., including 小蓝视频-headquartered Garmatex Holdings Ltd. for which Bahadoorsingh used a local public relations firm to pump up the firm’s trading price.
Carillo’s control group used Swiss-based trading platform and so-called asset manager Wintercap SA to orchestrate trades, according to the SEC.
The SEC complaint stated Wintercap SA was in business with Sharp, helping to disguise control and ownership of penny stocks for clients, such as Carillo.
The SEC and Federal Bureau of Investigation investigated Sharp and his associates, and uncovered an encrypted messaging network that revealed the alleged scheme, according to numerous related indictments.
Bahadoorsingh never bothered to answer to the SEC allegations and was found liable by default.
Bahadoorsingh was ordered to repay more than $802,000 in illicit profits from the scheme, plus more than $177,000 in pre-judgment interest and more than $414,000 in penalties.
Bahadoorsingh argued, as Sharp did, that the default judgment ought not to count in Canadian proceedings.
The panel noted it has long been established that this is not the case.
The panel stated it was in the public interest to impose orders on Bahadoorsingh although it noted the bans were limited to activities in the securities and derivatives markets and “there might be significant opportunities for Bahadoorsingh to provide tax services that do not conflict with this order.”
Bahadoorsingh is no longer allowed to trade securities (except in registered accounts) or become a director, officer or promoter of a 小蓝视频 registered issuer, .
It remains to be seen if the commission will take enforcement action against Carnovale, as well as a who have been barred from the U.S. penny stock markets after recently being found liable for fraud in criminal and civil proceedings brought by the FBI and SEC.
