Decision in brief: Valentine, Enforcement Proceeding, Sanctions and Costs, September 30, 2024

In an earlier decision, the Tribunal decided that Mark Valentine breached a 2004 order that permanently restricted him from becoming a director or officer of any company and restricted him from trading in securities for 15 years. Valentine breached the order in three ways: (i) by remaining or becoming a director and/or an officer of 38 companies, (ii) by playing an important role in the sale of 5 million shares of a company, and (iii) by participating in several financings called “stock secured financings”.

In this decision, the Tribunal decided what sanctions and costs should be ordered against Valentine for his misconduct.

Valentine accepted that he should be permanently banned from participating in Ontario’s capital markets and disgorge (give up to the Commission) the amounts he received in connection with his breaches of the trading ban ($3,257,639.75 and US$10,732,503). The Tribunal agreed these sanctions are in the public interest.

The Tribunal decided that Valentine should pay administrative penalties to the Commission totaling $1 million ($500,000 for his breach of the director and officer ban and $500,000 for his breaches of the trading ban). These amounts reflect the seriousness of Valentine’s misconduct and will send a message to Valentine, and to others, that the Tribunal will not tolerate flagrant breaches of Tribunal orders.

The Tribunal decided that Valentine must pay $300,000 in costs. This amount reflects a discount of approximately 53% from the total costs incurred by the Commission. The Tribunal reduced the amount of costs slightly from what was requested by the Commission for two reasons: (i) to account for the fact that the lawyers representing the Commission at the merits hearing changed at the last minute, resulting in increased costs for the Commission and Valentine, and (ii) because the Commission could have done a better job removing documents from the hearing brief (book of documents a party intends to enter as evidence at a hearing) it provided to Valentine in advance of the merits hearing. Only 377 of the nearly 3,000 documents were entered into evidence.