Investment
Man banned eight years, must pay $165K after WhaleClub crypto investment goes bust
In a Sept. 19 ruling, a three-person ASC panel noted that providing a prospectus was a “fundamental protection” for potential investors.
“WhaleClub members were exposed to significant financial risks that they did not fully appreciate when they invested.”
The WhaleClub later failed and those investors lost thousands, receiving back between 10 and 40 per cent of their initial investment, according to the ruling.
The ASC found Cerato didn’t directly financially benefit from the arrangements but may have used the WhaleClub as a means to market other business opportunities.
When reached by Postmedia, he did not agree to an interview and instead referenced several blog posts where he claims to have been bullied by the ASC and declares his innocence.
He did not respond to questions asking if he had paid the fines or intended to do so in the future.
‘A huge embarrassment’
The ruling outlines how Cerato solicited members of the public to join the WhaleClub in December of 2017 on condition of a minimum $10,000 investment.
The money was to be pooled and used to trade cryptocurrencies.
He told investors their funds would be used for 90 days when they would then be repaid along with 75 per cent of any profit, according to the ruling.
One promotion suggested that an investment could double every few weeks, the ruling reads.
“The WhaleClub investors were precisely the type of individuals who need the protection of prospectus-like disclosure,” the panel wrote.
One investor told the ASC he invested because it “all sounded too good not to.”
Another was persuaded by Cerato’s assurance that he could profit regardless of if Bitcoin’s value was going up or down.
‘Obvious intimidation tactic’
In determining the sanctions, the ASC noted Cerato’s “belligerent contempt” towards the investors after WhaleClub’s failure.
The ruling references several threatening texts he sent to them, including one that read, “I know you’re a rat and so do a lot of very dangerous people; enjoy.”
Other messages threatened civil litigation in what the panel determined to be a “significant” aggravating factor.
“We considered these communications to be an obvious intimidation tactic,” the ruling reads.
“(They) reflected a contemptuous disregard for investors harmed by his misconduct, and a lack of accountability and acceptance of any responsibility for his actions.”
In addition to the fines, Cerato must also cease trading in or purchasing securities, is prohibited from engaging in investor relations and also from acting in a management or consultative role.
Those bans remain in effect for at least eight years and until he pays the $165,000.
Economy
S&P/TSX composite down more than 200 points, U.S. stock markets also fall
TORONTO – Canada’s main stock index was down more than 200 points in late-morning trading, weighed down by losses in the technology, base metal and energy sectors, while U.S. stock markets also fell.
The S&P/TSX composite index was down 239.24 points at 22,749.04.
In New York, the Dow Jones industrial average was down 312.36 points at 40,443.39. The S&P 500 index was down 80.94 points at 5,422.47, while the Nasdaq composite was down 380.17 points at 16,747.49.
The Canadian dollar traded for 73.80 cents US compared with 74.00 cents US on Thursday.
The October crude oil contract was down US$1.07 at US$68.08 per barrel and the October natural gas contract was up less than a penny at US$2.26 per mmBTU.
The December gold contract was down US$2.10 at US$2,541.00 an ounce and the December copper contract was down four cents at US$4.10 a pound.
This report by The Canadian Press was first published Sept. 6, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
The Canadian Press. All rights reserved.
Economy
S&P/TSX composite up more than 150 points, U.S. stock markets also higher
TORONTO – Canada’s main stock index was up more than 150 points in late-morning trading, helped by strength in technology, financial and energy stocks, while U.S. stock markets also pushed higher.
The S&P/TSX composite index was up 171.41 points at 23,298.39.
In New York, the Dow Jones industrial average was up 278.37 points at 41,369.79. The S&P 500 index was up 38.17 points at 5,630.35, while the Nasdaq composite was up 177.15 points at 17,733.18.
The Canadian dollar traded for 74.19 cents US compared with 74.23 cents US on Wednesday.
The October crude oil contract was up US$1.75 at US$76.27 per barrel and the October natural gas contract was up less than a penny at US$2.10 per mmBTU.
The December gold contract was up US$18.70 at US$2,556.50 an ounce and the December copper contract was down less than a penny at US$4.22 a pound.
This report by The Canadian Press was first published Aug. 29, 2024.
Companies in this story: (TSX:GSPTSE, TSX:CADUSD)
The Canadian Press. All rights reserved.
Investment
Crypto Market Bloodbath Amid Broader Economic Concerns
-
Sports18 hours ago
Cavaliers and free agent forward Isaac Okoro agree to 3-year, $38 million deal, AP source says
-
Sports18 hours ago
Liverpool ‘not good enough’ says Arne Slot after shock loss against Nottingham Forest
-
News18 hours ago
k.d. lang gets the band back together for Canadian country music awards show
-
News18 hours ago
NATO military committee chair, others back Ukraine’s use of long range weapons to hit Russia
-
News18 hours ago
With a parade of athletes on Champs Elysées, France throws one last party for the Paris Olympics
-
Sports2 hours ago
Armstrong scores, surging Vancouver Whitecaps beat slumping San Jose Earthquakes 2-0
-
News18 hours ago
‘Challenges every single muscle’: Champion tree climber turns work into passion
-
News2 hours ago
As plant-based milk becomes more popular, brands look for new ways to compete