A former director of a B.C. mining company violated securities laws when he authorized the illegal sale of shares traded to seven investors in 2011, a B.C. Securities Commission (BCSC) panel has ruled.
Daniel McGee is expected to make a submission in July before the BCSC panel regarding sanctioning after the panel ruled he acquiesced to illegal trading within Cinnabar Explorations while he served as a director.
The panel previously ruled in September 2013 that Dale Zucchet and Cinnabar's ex-CEO Christopher Bass illegally sold shares to investors despite the fact the company never filed a prospectus in B.C.
Zucchet had made claims Cinnabar was going public when it was not and also counselled an investor to buy shares illegally.
Cinnabar claimed the investors fell under the family, friends and business associates exemptions but the panel found they did not.
In a ruling released June 11, the panel found McGee had authorized these transactions by signing the exempt distribution reports related to the illegal trades.
McGee testified during a December 2013 hearing he relied on Zucchet and Bass to find out if the exemptions were available.
“Ignorance of his obligations does not relieve McGee of liability," the panel said in its ruling.
In January, the BCSC ordered Cinnabar to permanently cease trading while Bass was fined $31,500 and Zucchet was fined $15,000.
Bass was previously sanctioned by the BCSC in 1988 after working as a registered investment advisor from 1986-87.
