The British Columbia Securities Commission has accused Nevada-based company Green Hygienics Holdings Inc. of violating the cease trade order (CTO) issued by the commission’s executive director.
The order was issued under section 164(1) of the Securities Act on November 18, 2014 and bans all trading in Green Hygienics securities. It is still in effect, but the BCSC said that over October 2019-March 2022, Green Hygienics reportedly issued 5,614,357 shares valued at $5,445,862.73 to 50 individuals. It also distributed promissory notes worth $3,074,885.
The commission alleged that the company’s then-CEO, president, and director, Ronald Wayne Loudoun, himself sold 250,000 Green Hygienics shares and divested 500,000 additional shares through a company he operated. He was also accused of acting in furtherance of other trades in Green Hygienics shares and distributions.
The BCSC said that these activities breached the CTO issued under the province’s Securities Act; moreover, Loudoun authorized, permitted, or agreed to the violation. Thus, Loudoun himself breached the CTO pursuant to section 168.2 of the Securities Act.
The commission has mandated an appearance at the BCSC offices by the respondents or their counsel on August 12. The appearance will permit Green Hygienics and Loudoun, who is based in BC, to make submissions and tender evidence before a hearing is set.
Green Hygienics and Loudoun may request the BCSC’s executive director to provide relevant information obtained by commission staff in its investigation. Should the respondents skip the hearing, the commission’s executive director may apply to have questions of liability and sanction heard concurrently. The BCSC warned the respondents that choosing not to attend the hearing could result in unfavorable outcomes for Green Hygienics and Loudoun.
Green Hygienics is an over-the-counter reporting issuer based in BC. The BCSC is an independent provincial government agency that implements rules, tracks industry compliance, acts against misconduct, and guides investors and the industry.