B.C. man and his company repeatedly violated cease trade order, securities regulator rules

A sign at the B.C. Securities Commission office in downtown Vancouver is seen on Dec. 28, 2024. (CTV News)

A B.C. man and the Nevada-based company he controlled from July 2017 until November 2022 each breached a cease trade order (CTO) against the company multiple times, according to a provincial regulator.

The B.C. Securities Commission issued the CTO against Green Hygienics Holdings Inc. in 2014. A decision issued by a panel of the BCSC this week does not specify why the CTO was put in place, but says it required all trading of the company’s securities to cease until the company filed certain records and the order was revoked.

The order remains in place to this day, according to a news release from the BCSC.

Ronald Wayne Loudoun became director, president and CEO of Green Hygienics in June 2017, and he was the company’s sole director after July 31, 2017, the BCSC decision indicates.

Between 2019 and 2021, the company issued treasury shares with a total value of $5.4 million to 50 people, as well as two promissory notes worth nearly $3.1 million combined.

The panel found these distributions to be violations of the cease trade order, and concluded the BCSC had the authority to enforce the order because Loudoun was a Vancouver resident during the relevant period.

As the person in control of the company, Loudoun was also responsible for violating the CTO, in that he authorized, permitted or acquiesced to the breaches, according to the decision.

The panel further found that Loudoun had personally breached the CTO by transferring 250,000 shares of Green Hygienics and by facilitating the trading of company shares between a third-party identified in the decision only as “S” and two other individuals.

The BCSC’s executive director had further alleged that a transfer of 500,000 shares to an individual violated the CTO, but the panel found this allegation unproven. Specifically, it concluded that the executive director had failed to establish that Loudoun owned the shares that were transferred.

The panel’s decision deals with Loudoun’s and the company’s liability for the CTO violations, but does not set out penalties for them.

Instead, the panel directed the parties to make submissions on the appropriate sanctions, with a final deadline of April 17.

Neither Loudoun nor any representative from Green Hygienics participated in the liability hearing, according to the BCSC.