Order: In the Matter of Majd Kitmitto et al.

IN THE MATTER OF
MAJD KITMITTO, STEVEN VANNATTA, CHRISTOPHER CANDUSSO, CLAUDIO CANDUSSO, DONALD ALEXANDER (SANDY) GOSS, JOHN FIELDING AND FRANK FAKHRY

File No. 2018-70

January 20, 2023

ORDER

(Subsection 127(1) and section 127.1 of the Securities Act, RSO 1990, c S.5)

WHEREAS on October 11 and 13, 2022, the Capital Markets Tribunal held a hearing by videoconference to consider the sanctions and costs that the Tribunal should impose on Majd Kitmitto, Steven Vannatta, Christopher Candusso, Donald Alexander (Sandy) Goss, and Frank Fakhry as a result of the findings in the Reasons and Decision on the merits, issued May 26, 2022;

ON READING the materials filed by the parties, and on hearing the submissions of the representatives for each of Staff of the Ontario Securities Commission and the respondents;

IT IS ORDERED THAT:

1. With respect to Kitmitto:

a. pursuant to paragraph 2 of s 127(1) of the Securities Act, RSO 1990, c S.5 (the Act), trading in any securities by Kitmitto shall cease for 10 years from the date of this order, except that Kitmitto shall be permitted to trade:

i. mutual funds, exchange-traded funds, government bonds and/or guaranteed investment certificates (GICs) for the account of any registered retirement savings plan (RRSP), registered retirement income fund (RRIF) and tax-free savings account (TFSA), as defined in the Income Tax Act, RSC 1985, c 1, as amended (the Income Tax Act), in which Kitmitto has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Kitmitto must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 1(g) and 1(h) have been paid in full;

b. pursuant to paragraph 2.1 of s 127(1) of the Act, the acquisition of any securities by Kitmitto is prohibited for a period of 10 years from the date of this order, except that Kitmitto shall be permitted to acquire:

i. mutual funds, exchange-traded funds, government bonds and/or GICs for the account of any RRSP, RRIF and TFSA, as defined in the Income Tax Act, in which Kitmitto has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Kitmitto must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 1(g) and 1(h) have been paid in full;

c. pursuant to paragraph 3 of s 127(1) of the Act, any exemptions contained in Ontario securities law do not apply to Kitmitto for a period of 10 years from the date of this order;

d. pursuant to paragraphs 7 and 8.1 of s 127(1) of the Act, Kitmitto shall immediately resign any positions that he holds as a director or officer of an issuer or registrant;

e. pursuant to paragraphs 8 and 8.2 of s 127(1) of the Act, Kitmitto is prohibited for a period of 10 years from the date of this order from becoming or acting as a director or an officer of any issuer or registrant;

f. pursuant to paragraph 8.5 of s 127(1) of the Act, Kitmitto is prohibited for a period of 10 years from the date of this order from becoming or acting as a registrant or as a promoter;

g. pursuant to paragraph 9 of s 127(1) of the Act, Kitmitto shall pay an administrative penalty in the amount of $600,000 to the Commission; and

h. pursuant to s 127.1 of the Act, Kitmitto shall pay $147,075, for the costs of the investigation and hearing.

2. With respect to Vannatta:

a. pursuant to paragraph 2 of s 127(1) of the Act, trading in any securities by Vannatta shall cease for 15 years from the date of this order, except that Vannatta shall be permitted to trade:

i. mutual funds, exchange-traded funds, government bonds and/or GICs for the account of any RRSP, RRIF and TFSA, as defined in the Income Tax Act, in which Vannatta has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Vannatta must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 2(g) through 2(i) have been paid in full;

b. pursuant to paragraph 2.1 of s 127(1) of the Act, the acquisition of any securities by Vannatta is prohibited for a period of 15 years from the date of this order, except that Vannatta shall be permitted to acquire:

i. mutual funds, exchange-traded funds, government bonds and/or GICs for the account of any RRSP, RRIF and TFSA, as defined in the Income Tax Act, in which Vannatta has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Vannatta must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 2(g) through 2(i) have been paid in full;

c. pursuant to paragraph 3 of s 127(1) of the Act, any exemptions contained in Ontario securities law do not apply to Vannatta for a period of 15 years from the date of this order;

d. pursuant to paragraphs 7 and 8.1 of s 127(1) of the Act, Vannatta shall immediately resign any positions that he holds as a director or officer of an issuer or registrant;

e. pursuant to paragraphs 8 and 8.2 of s 127(1) of the Act, Vannatta is prohibited for a period of 15 years from the date of this order from becoming or acting as a director or an officer of any issuer or registrant;

f. pursuant to paragraph 8.5 of s 127(1) of the Act, Vannatta is prohibited for a period of 15 years from the date of this order from becoming or acting as a registrant or as a promoter;

g. pursuant to paragraph 9 of s 127(1) of the Act, Vannatta shall pay an administrative penalty in the amount of $650,000 to the Commission;

h. pursuant to paragraph 10 of s 127(1) of the Act, Vannatta shall disgorge to the Commission the amount of $54,435; and

i. pursuant to s 127.1 of the Act, Vannatta shall pay $183,844, for the costs of the investigation and hearing.

3. With respect to Candusso:

a. pursuant to paragraph 2 of s 127(1) of the Act, trading in any securities by Candusso shall cease for three years from the date of this order, except that Candusso shall be permitted to trade:

i. mutual funds, exchange-traded funds, government bonds and/or GICs for the account of any RRSP, RRIF and TFSA, as defined in the Income Tax Act, in which Candusso has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Candusso must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 3(g) through 3(i) have been paid in full;

b. pursuant to paragraph 2.1 of s 127(1) of the Act, the acquisition of any securities by Candusso is prohibited for a period of three years from the date of this order, except that Candusso shall be permitted to acquire:

i. mutual funds, exchange-traded funds, government bonds and/or GICs for the account of any RRSP, RRIF and TFSA, as defined in the Income Tax Act, in which Candusso has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Candusso must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 3(g) through 3(i) have been paid in full;

c. pursuant to paragraph 3 of s 127(1) of the Act, any exemptions contained in Ontario securities law do not apply to Candusso for a period of three years from the date of this order;

d. pursuant to paragraphs 7 and 8.1 of s 127(1) of the Act, Candusso shall immediately resign any positions that he holds as a director or officer of an issuer or registrant;

e. pursuant to paragraphs 8 and 8.2 of s 127(1) of the Act, Candusso is prohibited for a period of three years from the date of this order from becoming or acting as a director or an officer of any issuer or registrant;

f. pursuant to paragraph 8.5 of s 127(1) of the Act, Candusso is prohibited for a period of three years from the date of this order from becoming or acting as a registrant or as a promoter;

g. pursuant to paragraph 9 of s 127(1) of the Act, Candusso shall pay an administrative penalty in the amount of $100,000 to the Commission;

h. pursuant to paragraph 10 of s 127(1) of the Act, Candusso shall disgorge to the Commission the amount of $30,782; and

i. pursuant to s 127.1 of the Act, Candusso shall pay $73,537, for the costs of the investigation and hearing.

4. With respect to Goss:

a. pursuant to paragraph 2 of s 127(1) of the Act, trading in any securities by Goss shall cease for 15 years from the date of this order, except that Goss shall be permitted to trade:

i. mutual funds, exchange-traded funds, government bonds and/or GICs for the account of any RRSP, RRIF and TFSA, as defined in the Income Tax Act, in which Goss has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Goss must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 4(g) through 4(i) have been paid in full;

b. pursuant to paragraph 2.1 of s 127(1) of the Act, the acquisition of any securities by Goss is prohibited for a period of 15 years from the date of this order, except that Goss shall be permitted to acquire:

i. mutual funds, exchange-traded funds, government bonds and/or GICs for the account of any RRSP, RRIF and TFSA, as defined in the Income Tax Act, in which Goss has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Goss must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 4(g) through 4(i) have been paid in full;

c. pursuant to paragraph 3 of s 127(1) of the Act, any exemptions contained in Ontario securities law do not apply to Goss for a period of 15 years from the date of this order;

d. pursuant to paragraphs 7 and 8.1 of s 127(1) of the Act, Goss shall immediately resign any positions that he holds as a director or officer of an issuer or registrant;

e. pursuant to paragraphs 8 and 8.2 of s 127(1) of the Act, Goss is prohibited for a period of 15 years from the date of this order from becoming or acting as a director or an officer of any issuer or registrant;

f. pursuant to paragraph 8.5 of s 127(1) of the Act, Goss is prohibited for a period of 15 years from the date of this order from becoming or acting as a registrant or as a promoter;

g. pursuant to paragraph 9 of s 127(1) of the Act, Goss shall pay an administrative penalty in the amount of $1,000,000 to the Commission;

h. pursuant to paragraph 10 of s 127(1) of the Act, Goss shall disgorge to the Commission the amount of $1,228,509; and

i. pursuant to s 127.1 of the Act, Goss shall pay $183,844, for the costs of the investigation and hearing.

5. With respect to Fakhry:

a. pursuant to paragraph 2 of s 127(1) of the Act, trading in any securities by Fakhry shall cease for 10 years from the date of this order, except that Fakhry shall be permitted to trade:

i. mutual funds, exchange-traded funds, government bonds and/or GICs for the account of any RRSP, RRIF and TFSA, as defined in the Income Tax Act, in which Fakhry has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Fakhry must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 5(g) through 5(i) have been paid in full;

b. pursuant to paragraph 2.1 of s 127(1) of the Act, the acquisition of any securities by Fakhry is prohibited for a period of 10 years from the date of this order, except that Fakhry shall be permitted to acquire:

i. mutual funds, exchange-traded funds, government bonds and/or GICs for the account of any RRSP, RRIF and TFSA, as defined in the Income Tax Act, in which Fakhry has sole legal and beneficial ownership;

ii. solely through a registered dealer in Ontario, to whom Fakhry must have given a copy of this order; and

iii. only after the amounts ordered in subparagraphs 5(g) through 5(i) have been paid in full;

c. pursuant to paragraph 3 of s 127(1) of the Act, any exemptions contained in Ontario securities law do not apply to Fakhry for a period of 10 years from the date of this order;

d. pursuant to paragraph 7 and 8.1 of s 127(1) of the Act, Fakhry shall immediately resign any positions that he holds as a director or officer of an issuer or registrant;

e. pursuant to paragraphs 8 and 8.2 of s 127(1) of the Act, Fakhry is prohibited for a period of 10 years from the date of this order from becoming or acting as a director or an officer of any issuer or registrant;

f. pursuant to paragraph 8.5 of s 127(1) of the Act, Fakhry is prohibited for a period of 10 years from the date of this order from becoming or acting as a registrant or as a promoter;

g. pursuant to paragraph 9 of s 127(1) of the Act, Fakhry shall pay an administrative penalty in the amount of $600,000 to the Commission;

h. pursuant to paragraph 10 of s 127(1) of the Act, Fakhry shall disgorge to the Commission the amount of $126,546; and

i. pursuant to s 127.1 of the Act, Fakhry shall pay $147,075, for the costs of the investigation and hearing.