Judge hands advisor jail time…finally

Judge hands advisor jail time…finally

Judge hands advisor jail time…finally Alberta Provincial Court judge Sharon Van de Veen has sentenced Calgary resident Neil Andrew McDonald to two years in jail after the former advisor pleaded guilty in 2014 to three counts of fraud.

McDonald’s misdeeds centred around $240,000 given to him by three investors who thought they were investing in the securities of a real estate company, Edgeworth Properties Inc. Instead of purchasing those securities McDonald put the funds into an account he himself controlled using those funds for his own personal purposes.

In addition to the fraud committed by McDonald, he also told the investors he was authorized to sell the Edgeworth Properties securities (he was not) and that these securities were protected by deposit insurance which also wasn’t true.

McDonald also held up his hand to having violated the 2010 settlement agreement with the Alberta Securities Commission, which blocked him from having anything to do with securities until 2025 (other than having one personal account with an existing ASC registrant).

The 2010 settlement agreement involved diverting $439,000 from seven investors who thought McDonald was investing the funds in GIC’s. Instead, he put the money into a numbered company bank account that he controlled. Approximately $260,000 of those funds were then invested in the securities of another company with the shares held in the names of himself and his boss and business partner.

The judge added three years’ probation to the sentence while also requiring that the three investors be repaid the $240,000 as part of McDonald’s probation. In addition, each of the investors were to receive $12,000 from bank accounts frozen by the ASC as part of their investigation into the former advisor’s unlawful activities.

Most importantly, McDonald has received a lifetime ban from trading in securities or acting as an advisor in connection with activities in the securities market.