OSC Panel Issues Sanctions Against Gordon Driver, Steven M. Taylor, Reynold Mainse, Axcess Automation LLC And Others For Breaches of the Ontario Securities Act

TORONTO – A panel of the Ontario Securities Commission (OSC) released today its Reasons and Decision on Sanctions and Costs against Gordon Alan Driver (Driver), Axcess Automation LLC and other companies (the Axcess Companies), Steven M. Taylor (Taylor), Berkshire Management Services Inc. and other companies (the Taylor Companies), Reynold Mainse (Mainse) and World Class Communications Inc. (WCC).

In its Decision on the merits, released on September 27, 2012, the Commission found that Driver, the Axcess Companies, Taylor and the Taylor Companies knowingly engaged in fraud through their involvement in two investments that centered on purported futures trading. The Commission held that “Driver was the directing mind of an investment scheme that, whatever its original objectives, was clearly fraudulent...”

The Commission also found that “Taylor was inextricably involved in furthering the fraudulent elements of the scheme and was clearly aware that he and Driver and their respective companies were acting illegally.” Mainse and WCC were found to have engaged in unregistered trading and illegal distribution, but were not found to have been party to the fraud.

In its decision on sanctions and costs, the Commission ordered the following:

Driver and the Axcess Companies

• Must disgorge $3,116,013.18, and pay an administrative penalty of $750,000.00;
• Are prohibited permanently from trading in or acquiring any securities;
• Any exemptions contained in Ontario securities law do not apply to them permanently; and,
• Driver must resign any position he holds as a director and officer of an issuer, and is prohibited permanently from becoming or acting as a director and officer of any issuer, registrant or investment fund manager, or from acting as a registrant, an investment fund manager or as a promoter.

Taylor and the Taylor Companies

• Must disgorge $1,576,098.03, and pay an administrative penalty of $500,000.00;
• Are prohibited permanently from trading in or acquiring any securities;
• Any exemptions contained in Ontario securities law do not apply to them permanently; and,
• Taylor must resign any position he holds as a director and officer of an issuer, and is prohibited permanently from becoming or acting as a director and officer of any issuer, registrant or investment fund manager, or from acting as a registrant, an investment fund manager or as a promoter.

Mainse and WCC

• Must disgorge $210,219.50, and pay an administrative penalty of $35,000.00;
• Are prohibited from trading in any or acquiring securities for 15 years, provided that Mainse is permitted to trade in or acquire securities for his Registered Retirement Savings Plan (RRSP) account once the administrative penalty and disgorgement order are paid in full;
• Any exemptions contained in Ontario securities law do not apply to them for a period of 15 years, except to the extent that such exemption is necessary for trades undertaken in connection with Mainse’s RRSP account once the administrative penalty and disgorgement order are paid in full; and,
• Mainse is prohibited from becoming or acting as a director and officer of any issuer, registrant or investment fund manager, or from acting as a registrant, an investment fund manager or as a promoter for a period of 15 years.

With respect to costs, the Commission ordered Driver, the Axcess Companies, Taylor and the Taylor Companies must pay costs in the amount of $202,186.00, of which Mainse and WCC will be jointly and severally liable for $2,500.00.

A copy of the Reasons and Decision on Sanctions and Costs and the Reasons and Decision on the Merits are available on the Commission websites at www.osc.ca.

The mandate of the Commission is to provide protection to investors from unfair, improper or fraudulent practices and to foster fair and efficient capital markets and confidence in capital markets. Investors are urged to check the registration of any person or company offering an investment opportunity and to review the Commission’s investor materials available at www.osc.ca.

 

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