Alberta Securities Commission: ASC Sanctions Two Unregistered Dealers in Canada

• The Alberta Securities Commission has sanctioned two individuals and their companies for breaching Alberta securities laws by acting as unregistered dealers.
• Glenn Hunter and Kyle Watters, based in Grande Prairie and Kelowna respectively, along with their companies HW & Associates Inc. and HW TradeFX LLC, were found to have operated without proper registration.
• FINTRAC's financial intelligence played a crucial role in the investigation that led to the findings.
• The ASC has taken a proactive approach in regulating the industry to maintain market integrity, issuing significant penalties and market-access bans.

This outcome followed an investigation where FINTRAC's financial intelligence was recognized by the ASC.

The Alberta Securities Commission (ASC) has sanctioned two individuals and their companies for breaching Alberta securities laws. Glenn Hunter, based in Grande Prairie, and Kyle Watters, from Kelowna, along with HW & Associates Inc. and HW TradeFX LLC, were found to have acted as unregistered dealers. The ASC determined that they operated without proper registration under Alberta securities laws and raised about $20 million from approximately 200 investors between February 2021 and February 2023. This outcome followed an investigation where FINTRAC's financial intelligence was recognized by the ASC.

In Canada, unregistered dealers are subject to penalties under provincial securities laws. The ASC has taken a proactive approach in regulating the industry, and the sanctions issued in this case are a testament to their commitment to maintaining market integrity. FINTRAC's role in providing financial transaction reports from Canadian businesses across the country has been instrumental in assisting law enforcement agencies like the ASC. This collaboration highlights the importance of inter-agency cooperation in combating unregistered dealer activity.

Lawyers and compliance officers should be aware of the potential exposure to penalties under Alberta securities laws for clients who may be acting as unregistered dealers. The ASC's action serves as a reminder that proper registration is crucial in maintaining a fair and transparent market. The final decision in this case underscores the need for vigilance in detecting and preventing unregistered dealer activity. Kyle Watters was ordered to pay over $1 million and received 20-year market-access bans, while Glenn Hunter was ordered to pay $600,000 and received 16-year market-access bans. Both HW & Associates Inc. and HW TradeFX LLC are subject to permanent market-access bans.

Lawyers and compliance officers should watch for potential exposure to penalties under Alberta securities laws if they have clients who may be acting as unregistered dealers, and consider advising clients on the importance of proper registration.

Source: Original reporting via News release: ASC alleges Glenn Hunter of Grande Prairie and Kyle Watters of Kelowna and their companies, HW & Associates Inc. and HW TradeFX LLC, acted as unregistered dealers