Michael Aonso and Kevin Carmichael Charged with Securities Act Offences
For Immediate Release OSC Enforcement
TORONTO – The Ontario Securities Commission (OSC) announced today that Michael Aonso of Mississauga, Ontario, and Kevin Carmichael of Hamilton, Ontario, have been charged with fraud, unregistered trading and other offences under the Ontario Securities Act (the “Act”).
The OSC alleges that, from April 30, 2012 to June 30, 2019, Mr. Aonso and Mr. Carmichael defrauded 57 investors, including Ontario residents, by raising approximately $31 million through Strike Holdings Inc. (“Strike”) based on claims they would use the money to trade with an advanced algorithm.
According to the allegations, the accused grossly misled investors by providing forged trading account statements showing highly profitable returns. Mr. Aonso and Mr. Carmichael are alleged to have taken more than $11 million from the scheme personally, while the balance of funds was depleted primarily through expenses, fees and investor returns.
Additionally, the OSC alleges that from August 1, 2020 to March 31, 2021, Mr. Aonso and Mr. Carmichael re-victimized Strike investors.
The accused are alleged to have falsely told investors that USD $97 million had gone missing from Strike’s TD Bank accounts. Based on this misrepresentation, they raised more than CAD $900,000 by selling debentures to 20 existing Strike shareholders for the purpose of pursuing legal action to recover the missing funds. Instead, proceeds from the debenture offering were depleted through trading and commissions until the OSC intervened to halt the scheme. OSC Enforcement staff froze cash and securities valued at more than CAD $730,000 and returned these funds to investors.
Finally, Mr. Aonso and Mr. Carmichael are alleged to have made misleading or untrue statements by issuing forged trading account statements to their investors throughout the two schemes, as well as to TD Bank in pursuing their false claim that USD $97 million had been lost.
Mr. Aonso and Mr. Carmichael have been charged with:
- Two counts each of engaging in an act, practice or course of conduct related to securities that they knew or reasonably ought to have known perpetrated a fraud on investors, contrary to s. 126.1(1)(b) of the Act;
- Two counts each of illegal distribution of securities, contrary to s. 53(1) of the Act;
- Two counts each of unregistered trading in securities, contrary to s. 25(1) of the Act; and,
- One count of making a statement that they knew or reasonably ought to have known was misleading or untrue and would reasonably be expected to have a significant effect on the market price or value of a security, contrary to s. 126.2(1) of the Act.
Mr. Aonso and Mr. Carmichael are scheduled to appear in court on this matter on April 5, 2022 at 9:00 a.m. in Courtroom #1 at the Milton Ontario Court of Justice at 491 Steeles Ave E, Milton, Ontario.
This investigation was conducted by a team within the OSC Enforcement branch that investigates the most serious breaches of Ontario securities law, including the investigation of alleged recidivists, and prosecutes these matters in provincial court. Their primary objective is to protect investors and further enhance confidence in the Canadian capital markets through effective enforcement. Since inception, this team has pursued 58 matters before the courts involving 84 accused.
The OSC wishes to acknowledge the significant contributions of the Halton Regional Police Service Regional Fraud Unit in completing this investigation.
Charges laid under the Securities Act are prosecuted by the OSC. Charges laid under the Criminal Code are prosecuted by the Ministry of the Attorney General.
The mandate of the OSC is to provide protection to investors from unfair, improper or fraudulent practices, to foster fair, efficient and competitive capital markets and confidence in the capital markets, to foster capital formation, and to contribute to the stability of the financial system and the reduction of systemic risk. Investors are urged to check the registration of any persons or company offering an investment opportunity and to review the OSC investor materials available at http://www.osc.ca.
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