A review board has ordered that Samuel T.G. Cole receive a six-month suspension and rescinded a fine of $20,000 ordered by a hearing panel in a previous decision. The review board found that a six-month suspension, instead of the previously ordered four-month suspension, is the appropriate sanction due to the seriousness of the misconduct. It also found that the hearing panel made an error when it ordered a combination of suspension and fine as the sanction, as a fine does not supplement a shorter suspension.
For details, read the review board’s decision.
In 2021, a hearing panel found that Cole committed professional misconduct when he knowingly and purposely circumvented a directive of a securities regulator for the attempted benefit of his client. Cole was retained by a client to help create a publicly traded company. Cole then advised and assisted his client in planning and executing a reverse takeover of an existing company, including by adding the client to the board to ensure the reverse takeover occurred without difficulties. As a board member the client was an insider, and therefore ineligible to take part in a planned private placement because of the securities regulator’s directive. Cole then advised his client to circumvent the securities regulator’s directive by using his then-girlfriend as a nominee and drafted and filed the required paperwork so that she could take part in the private placement. Cole also implemented the reverse takeover and filed materials containing false information with the securities regulator.
For the hearing panel’s detailed reasons, see the decision on facts and determination and the decision on disciplinary action.
