ASC finds Lawrence Zeiben, Grit International Inc. and Texas Petroleum Inc. committed fraud and misrepresentation

CALGARY, May 7, 2014 /CNW/ - The Alberta Securities Commission (ASC) has found that Lawrence Zeiben (Zeiben) and his companies Grit International Inc. (Grit) and Texas Petroleum Inc. (Texas Petroleum ) breached Alberta securities laws and acted contrary to the public interest by perpetrating a fraud on investors and making misrepresentations to investors.  An ASC panel also ruled that Grit illegally distributed its shares in Alberta.

The ASC panel found misrepresentations as to the nature and extent of Zeiben's companies' operations, earnings or potential revenue. The ASC panel also found that Zeiben, Grit and Texas Petroleum perpetrated a fraud on investors by using these misrepresentations to promote and sell Grit and Texas Petroleum shares. The ASC panel noted: "The façade attracted investors, pumped up the share price, increased share sales, and, when the façade came down, disappointed investors lost their investment."

The ASC panel rejected Zeiben's claims that he should not be found liable because he did not know the law and what he needed to do to comply with it. The ASC panel ruled that not knowing the law is not a defence and: "This is all the more so in the case of an individual who chooses to go into the business of acquiring, promoting and running a public company subject to the Alberta Securities Act. It is incumbent upon individuals who undertake this type of activity to familiarize themselves with the law applicable to the activity."

The ASC panel set a date of May 20, 2014 for the purpose of scheduling dates for providing evidence and submissions on what, if any, orders for sanctions and costs ought to be made.

A copy of the decision is available 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 with fostering a fair and efficient capital market in Alberta and with protecting investors.  As a member of the Canadian Securities Administrators, the ASC works to improve, coordinate and harmonize the regulation of Canada's capital markets.

SOURCE: Alberta Securities Commission

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