ASC finds Arbour Energy, Dennis Morice, Milowe Brost, IFFL, Merendon Mining and Gary Sorenson committed fraud

CALGARY, April 2, 2012 /CNW/ - The Alberta Securities Commission (ASC) has found that Arbour Energy Inc., Dennis Morice, Milowe Brost, The Institute For Financial Learning, Group of Companies Inc. (IFFL), Merendon Mining Corporation Ltd. and Gary Sorenson breached Alberta securities laws and, in so doing, acted contrary to the public interest by perpetrating a fraud on Alberta investors.

An ASC panel ruled that Arbour Energy, Morice, Brost, IFFL, Merendon Mining and Sorenson "perpetrated a deliberately complex, coordinated, far-reaching and massive - almost $46 million - fraudulent investment scheme....  All of the Respondents were separate but necessary cogs in the fraud machinery."

The ASC panel also found that:

• Arbour, Morice, Brost and IFFL illegally traded in and distributed securities without registration, a prospectus or exemptions;
• Brost and IFFL illegally acted as advisors without registration or exemptions;
• Arbour and Morice made statements in offering memoranda that they knew or reasonably ought to have known were untrue or misleading; and
• Brost and IFFL failed to comply with September 2004 undertakings given to the ASC to cease trading in securities and acting as advisors, and with an ASC order accepting those undertakings.

In the ruling, the ASC panel commented: "In addition to placing specific investors at risk and denying them the opportunity to make informed investment decisions, the Respondents' fraudulent actions seriously impaired the reputation of the Alberta capital market and investor confidence in that market."

Dates have been set in May and July 2012 for the parties to provide submissions on what, if any, orders the ASC panel should make against Arbour Energy, Morice, Brost, IFFL, Merendon Mining and Sorenson.

A copy of the decision is posted on the ASC website at www.albertasecurities.com.

The ASC is the regulatory agency responsible for administering the province's securities laws. It is entrusted to foster a fair and efficient capital market in Alberta and to protect investors.  As a member of the Canadian Securities Administrators, the ASC works to improve, coordinate and harmonize the regulation of Canada's capital markets.

For Media Inquiries:

Mark Dickey
Senior Communications Advisor
403.297.4481

For Investor Inquiries:

ASC Public Inquiries
Toll Free 1.877.355.4488