On February 22, 2019, the Ontario Securities Commission (OSC) issued an interjurisdictional order, permanently forbidding USI-Tech Management Limited (USI -Tech) from trading in or acquiring securities, and from trading in derivatives in the province of Ontario (the permanent order).

The permanent order was issued after an earlier order was issued by Autorite des marches financiers (AMF) that found USI-Tech guilty of the illegal distribution of securities and forbade USI-Tech from trading in any form of securities.

The five-page permanent order, based on s. 127(1) and s. 127(10) of the Ontario Securities Act (The Act), which allows for the prohibition of conduct that would be detrimental to the markets and the public interest, and the issuing of the inter-jurisdictional enforcement of orders imposed following breaches of securities law. The permanent order follows a series of temporary orders by the OSC.

CSA staff found that USI-Tech, a Dubai-based online cryptocurrency and forex trading platform, is not a reporting issuer in Ontario and has never filed a prospectus in Ontario, nor was it registered as a broker in Quebec with the AMF. It’s purported offering was a “Bitcoin package,” which offered investors a return of 1% a day; and a “token,” that offered investors in the opinion of the OSC “astronomical” returns, based on the success of a hypothetical new cryptoasset, the Tech Coin, that USI-Tech intended to create and market.

The Ontario and Quebec verdicts are only the most recent enforcement decisions against USI-Tech by regulators in jurisdictions in Canada, the United States, and elsewhere.

The complete written verdict  is available for download from the website of the Ontario Securities Commission.

For more information, please call Barbara Hendrickson at BAX Securities Law (416) 601 -1004.

This publication is not intended to constitute legal advice. No one should act on it or refrain from acting on it without consulting with a lawyer. BAX does not warrant or guarantee the accuracy or currency or completeness of the publication. No part of this publication may be reproduced without the prior written permission of BAX Securities Law.