B.C. man busted for breaching cease trade orders

In a settlement agreement with the British Columbia Securities Commission, Kevin Penstock has admitted that he repeatedly breached cease trade orders (CTO) issued by the executive director against his company, iTokk Inc.

Penstock is a Vancouver resident and is the president, chief executive officer, chief financial officer, secretary, treasurer, director and majority shareholder of iTokk.

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The agreement states that on June 11, 2010, the executive director cease-traded the securities of iTokk, an OTC reporting issuer with its head office in Vancouver, for failure to file documents. In spite of this, iTokk and Penstock issued 134,398 shares of iTokk by entering into subscription agreements between June 11 and June 25, 2010, raising approximately $336,000. iTokk and Penstock acknowledged that this action constituted a breach of the CTO. The CTO was revoked in September 2010 after iTokk filed the required documents.

However, in October 2010, the executive director again cease-traded the securities of iTokk for failure to file documents. Between January 13 and March 28, 2011, iTokk and Penstock issued 19,609 shares of iTokk by entering into subscription agreements, raising approximately $50,000. iTokk and Penstock have acknowledged that this action constituted a breach of the CTO issued in October 2010. The company remains cease-traded.

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For his misconduct, Penstock has agreed to pay $55,000 to the BCSC, and to take the officers and directors course within one year of the date of the agreement and provide proof of the completion of the course to the executive director. Additionally, Penstock must provide proof satisfactory to the BCSC that he has engaged current members in good standing of the Institute of Chartered Accountants of British Columbia and the Law Society of British Columbia as advisors to iTokk, and that he has disclosed any order made against him or iTokk to those advisors.

Penstock is also prohibited from becoming or acting as a director or officer of any issuer or registrant for a period of five years, except for iTokk.

The agreement notes that Penstock cooperated with BCSC staff’s investigation.

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Staff

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