A Sooke man has been hit with a hefty penalty for lying to an investor about the ownership of the Sooke Harbour House Hotel.
According to an April 19 news release from the B.C. Securities Commission, (BCSC), Timothy Craig Durkin has been ordered to pay $600,000 for committing fraud by telling an investor she would obtain part ownership of the internationally acclaimed Sooke Harbour House through the purchase of shares in SHH Holdings Ltd.
Durkin told the investor that he was a director of SHH Holdings, owned all of the shares of the hotel through a subsidiary and that by buying 40 per cent of the shares, the investor would acquire a 40 per cent ownership interest in the hotel.
SHH was also ordered to pay $1 million, which represents the amount it obtained for the fraud. That amount owed to the BCSC would be reduced by the amount paid, if any, to the investor due to judgment in a civil action in B.C. Supreme Court.
RELATED: Vancouver Islander accused of selling fake ownership in world-renowned Sooke Harbour House
At the time, however, SHH did not own any of the shares in the corporation that owned the hotel. The BCSC panel concluded that on three occasions, SHH and Durkin made false statements about the hotel’s ownership, despite knowing that those statements would be taken as an accurate representation of its current financial situation.
Based on false and misleading information, the investor’s company signed an agreement with SHH and advanced $1 million to purchase shares. The funds were spent and have not been recovered.
ALSO READ: Sooke Harbour House renovations nearing completion
In addition to the $600,000 administrative penalty, Durkin has been permanently barred from B.C.’s investment market, and must resign from any position he holds as a director or officer of an issuer or registrant.
He is also prohibited from trading or purchasing any securities or derivatives, becoming or acting as a director or officer of any issuer or registrant, or becoming an acting registrant or promoter.
Other prohibitions for Durkin include advising or otherwise acting in a management or consultative capacity in connection with activities in securities or derivative markets, engaging in promotional activities by or on behalf of an issuer, security holder or party to a derivative, or another person that is reasonably expected to benefit from the promotional activity, and relying on any exemptions set out in the Securities Act, the regulations, or a decision.
“Only a broad, multi-decade-long prohibition will provide a meaningful level of protection to the public,” the BCSC panel said in the release.
IAG Enterprises, which purchased the Sooke Harbour House Hotel for $5.6 million in July 2020, said in January that renovations are nearing completion. The property was placed on the market in the summer of 2022 while the company explored its options.
For more on the BCSC, visit investright.org.
editor@sookenewsmirror.com
Like us on Facebook and follow us on Twitter