The Manitoba Securities Commission is certain the Securities Act was violated by people selling shares to support the hemp industry.
The securities commission began investigating last month after questions were raised by people approached to buy shares in unnamed Manitoba companies. Hundreds of thousands of dollars worth of shares were sold around the Dauphin region of Manitoba.
When interviewed May 28, commission spokesperson Doug Brown said the investigation is ongoing, but there’s evidence to show violations of the Securities Act did occur. The commission is trying to learn who organized the share offering.
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Another mystery is whether those involved with the share offering knew that they were sidestepping the Securities Act. “Who knew and who should have known?” said Brown, describing one of the fundamental questions of the investigation.
The Parkland Industrial Hemp Growers Co-op has said it was not selling shares, even though its name was on the form of acknowledgement that prospective investors were asked to sign.
A member of the growers co-op said the shares were being sold by Consolidated Growers and Processors, a company planning to build two hemp processing plants at Dauphin.
CGP has been co-operating in the investigation, said Brown, the security commission’s director of enforcement. The company said last month it expects to be cleared of wrongdoing.
Despite the stir caused by the investigation, community leaders remain supportive of CGP’s plans to process hemp at Dauphin. The recent events are viewed as “a bump in the road” by Tom Van Buekenhout. He chairs a co-ordinating committee formed to help lay the groundwork for construction of the hemp processing plants. He’s confident the plans will go ahead.
“I think CGP will make every effort to get themselves and the securities commission straightened around and then simply proceed with the project.”
Brown said his office was swamped last week with calls from investors wanting to know the status of the investigation and when their money will be returned. The securities commission has seized the money related to the share offering and planned to begin returning it to investors June 3.
The commission plans to have an office in Dauphin where investors can claim their money. The office, located in the Provincial Building on Second Avenue, will be open June 3 and 4.
Investors must present photo identification when reclaiming their money. The commission also wants them to present proof such as a money order receipt to show how much they invested.
Brown expects the investigation to continue for at least two more weeks. He would not discuss other details.
