The Alberta Securities Commission is restricting the purchase and trade of specific securities by St. Albert-based Fast Track Group.
David Linder, executive director of the commission, issued a cease-trade order against the company’s FT Capital Fund 7 in mid-August after it failed to meet filing requirements.
“It’s very clear that the cease-trade order applies to FT Capital Fund 7 and what it applies to is the trading and purchasing in any FT Capital Fund 7 securities,” said Lorinda Brinton, senior communications advisor for the Alberta Securities Commission.
FT Capital Fund 7 deals with national and international energy-asset investment and started trading on Oct. 7, 2011.
The cease-trade order came after the commission determined the company failed to meet filing requirements for a pair of offering memorandum documents.
Amardeep Gill, chief financial officer of Fast Track Capital, said the cease-trade order is centred around a desire for additional disclosure for purchasers.
“[The commission] identified some areas for us where they wanted us to provide additional disclosure and, at this point in time, we have gone back with our legal counsel and are working towards providing that additional disclosure,” he said.
Gill said the company will resubmit the paperwork to the commission for approval.
Brinton said the order may be revoked or varied if the company’s re-filed documents meet the requirements set out in the province’s Securities Act.
At the time of the order, the commission also accepted a pair of undertakings from the company in relation to FT Capital Fund 3 and FT Capital Fund 8 offering memoranda.
“The offering memorandum is an information document that’s given to those who invest,” Brinton said. “[Fast Track] submitted that to the ASC – it’s a requirement by law – and it didn’t meet the requirements, so they basically have agreed to stop delivering that to people.”
The company also agreed to stop distributing or engaging in further trade with these funds until it files documents in compliance with the securities laws.
“We identified for the [commission] that the additional disclosure they wanted also existed in the other two [funds],” Gill said. “That was a voluntary undertaking we did, which I think shows some good faith.”
He said the company intends to resubmit the offering memoranda.
This is the second cease-trade order for the company, which received its first order from the British Columbia Securities Commission in 2009. The order was lifted three months later, Gill said.
Brinton said if a company is found in breach of a cease-trade order or undertaking, further enforcement action is possible.
“The (commission) doesn’t tolerate a breach of securities law and that’s in an effort to maintain the integrity of the capital market,” she said.
Brinton said she could not disclose what prompted the review, as per commission policy. The commission is responsible for ensuring Alberta’s securities laws are followed and enforced.
The Fast Track Group was founded in 2001 and acts as the umbrella group for companies such as Fast Track Capital, Fast Track Tax Strategy and Fast Track to Cash Flow.
Since the beginning of this year, the commission has issued 66 cease-trade orders in Alberta. A total of 68 cease-trade orders were issued last year, down from 91 in 2010.
