BCSC panel orders West Vancouver man to resign from company he founded

VANCOUVER, BC, May 18, 2023 /CNW/ - A West Vancouver man must resign as the head of a company for violating a previous order of the B.C. Securities Commission (BCSC) and for failing to disclose his enforcement history while raising money from investors.

Patrick Aaron Dunn, an officer and director of Viribus Structural Connectors Inc., must resign from those positions within 90 days, and is banned from serving as a director or officer of any issuer or registrant for at least seven years. He must also pay a $60,000 administrative penalty.

In March 2016, Dunn signed a settlement agreement with the BCSC for unregistered trading and illegal distribution of securities in connection with investments he raised for a seniors housing complex in Creston. The order prohibited Dunn for two years from, among other things, becoming or acting as a director or officer of any issuer or registrant unless he owned all of the shares.

Later in 2016, Dunn incorporated a company in B.C. and at times acted as a director, but he did not own all of the company's shares. Dunn also acted as a director of another company between July 2016 and March 2017, and did not own all of the shares in that company. By acting as director or officer of two companies when he was prohibited from doing so, Dunn breached his settlement agreement

Dunn was also the sole director and officer for Viribus, which was incorporated in B.C. in 2017, and which launched two crowdfunding campaigns in 2020 that raised $17,300 from 69 investors. In its offering document, Viribus did not disclose Dunn's enforcement history – as required by the Securities Act – when it encouraged investors to buy shares.

The BCSC panel found that Viribus violated the Act by failing to disclose Dunn's regulatory history. It also found that Dunn violated the Act by authorizing, permitting or acquiescing in Viribus' violation.

"… Such misconduct harms all investors and the market generally by causing an erosion of trust in the integrity of the market," the panel wrote.

Dunn must resign immediately from any director or officer position he holds with an issuer or registrant, though that order, with regards to Viribus, won't take effect for 90 days. The delay is intended to give the company time to comply with Dunn's resignation – for example, by appointing new directors or new officers, or by finding a buyer.

In addition to the ban on being an officer or director, Dunn is prohibited for at least seven years from:

• Becoming or acting as a registrant or promoter
  
  
• Advising or acting in a management or consultative capacity in the securities or derivatives markets, and
  
  
• Engaging in promotional activities by or on behalf of an issuer, security holder or party to a derivative, or another person that is reasonably expected to benefit from the promotional activity.

The prohibitions on Dunn's market activity will continue until he pays the administrative penalty.

Viribus must pay an administrative penalty of $10,000.

About the B.C. Securities Commission (www.bcsc.bc.ca)

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

Brian Kladko, 604-899-6713; Public inquiries: 604-899-6854 or 1-800-373-6393 (toll free), [email protected]