West Vancouver man and his two companies admit to conduct abusive to investment market

VANCOUVER, BC, Feb. 22, 2024 /CNW/ - A West Vancouver man and two companies he controlled have admitted to participating in a scheme involving private placements and prepaid consulting fees that was abusive to the investment market.

As part of a settlement agreement with the B.C. Securities Commission (BCSC), Justin Liu, Lukor Capital Corp. and Asiatic Management Consultants Ltd. have paid $950,000 to the BCSC and are banned from participating in the investment market for ten years. Liu is allowed to trade in his own account through a registered dealer or registrant, but must provide the dealer or registrant with a copy of the BCSC order before doing so.

Liu controlled Lukor, which dissolved in 2017, and was the sole owner and director of Asiatic.

Liu, the companies, and other consultants and their affiliated companies entered into consulting agreements with various issuers listed on the Canadian Securities Exchange. Although they did little or no consulting work, they used their role as consultants to purchase, through private placements, tradeable shares of the issuers.

As part of the scheme, nine issuers announced gross proceeds of $50.9 million from the private placements. Most of those funds were then given to the consultants as prepaid consulting fees, with the issuers retaining only $7.9 million. The consultants, in most instances, sold their shares after purchasing them, at prices that were generally below the private placement price.

Liu and Lukor, in particular, purchased a total of $5.6 million worth of shares from two issuers, and sold the shares before or shortly after receiving them. Liu, Lukor or Asiatic also received a total of $4.5 million in prepaid consulting fees from the nine issuers.

Liu, Lukor, Asiatic or other entities associated with Liu indirectly received additional amounts from other consultants. Liu also obtained $629,000 worth of shares from other participants in the scheme, and sold them shortly thereafter.

Liu, Lukor and Asiatic paid $12.4 million to other participants, who used the funds to buy other private placement shares.

As part of the settlement agreement, Liu and the companies consent to an order made by any Canadian securities regulator that contains the BCSC's order.

The B.C. Securities Commission is the independent provincial government agency responsible for regulating capital markets in British Columbia through the administration of the Securities Act. Our mission is to protect and promote the public interest by fostering:

• A securities market that is fair and warrants public confidence
• A dynamic and competitive securities industry that provides investment opportunities and access to capital.

Learn how to protect yourself and become a more informed investor at www.investright.org

SOURCE British Columbia Securities Commission