Decision in brief: Rosborough, Enforcement Proceeding, Sanctions and Costs Hearing, January 10, 2023

In an earlier decision, the Tribunal decided that Taylor Carr and Dmitri Graham had violated Ontario securities law. Carr, an employee of WeedMD, learned about a confidential planned expansion by WeedMD, and traded in shares of WeedMD before that expansion was publicly announced. The Ontario Securities Act says that trading under those circumstances is not allowed.

Carr also told someone else about the planned expansion, which is also not allowed. Graham did not insider trade. However, the Tribunal decided that he did not tell the truth when he was interviewed by OSC staff as part of their investigation.

In this decision, the Tribunal decided what sanctions and costs should be ordered against Carr and Graham because of their conduct.

Carr agreed with OSC staff’s request that he be banned from participating in the capital markets in various ways for three years and that he would have to pay back the $1,215.03 profit he made from the insider trading. Carr did not agree with staff’s request that he pay a $26,125 administrative penalty.  

The Tribunal decided to order that Carr pay an administrative penalty of $15,000. The Tribunal said that Carr’s misconduct was serious but it happened only once, Carr made only a small profit, and once OSC staff started this proceeding against him, Carr did many things to make the proceeding more efficient, including by admitting to the essential facts.

OSC staff asked that the Tribunal prevent Graham from participating in the capital markets for five years and that it order him to pay an administrative penalty of $75,000. Graham did not participate in the hearing. The Tribunal agreed with a five-year ban, because Graham’s misconduct was serious, he had been a registered salesperson for almost four years, and the Mutual Fund Dealers Association had decided that he had previously committed similar misconduct with them. The Tribunal decided that a $40,000 administrative penalty would be appropriate.

The Tribunal also required Carr and Graham to pay a portion of the costs of the investigation and the proceeding. It ordered Carr to pay $5,000 and Graham to pay $15,000.