The Ontario Securities Commission (OSC) has charged Sino-Forest Corporation and some of its former top executives with fraud involving Hong Kong-listed Greenheart Group.
On July 12, the OSC will hold a hearing to decide whether to punish the Chinese logging firm and the former executives, according to the commission's website.
Sino-Forest was once the most valuable forestry firm on the Toronto Stock Exchange, with a market capitalisation of over US$6 billion on March 31, 2011. The exchange delisted Sino-Forest on May 9.
The possible penalties to be decided at the July hearing include a permanent ban on taking an executive post at any Canadian listed company for Sino-Forest's former chairman and CEO Allen Chan Tak-yuen, former chief financial officer David Horsley, former senior vice-president Albert Ip, former vice-president Alfred C.T. Hung, former vice-president George Ho and former vice-president Simon Yeung.
The OSC will also decide whether to fine each accused party up to US$1 million for failure to comply with Canadian securities law.
'Sino-Forest and its former senior executives ... engaged in a complex fraudulent scheme to inflate the assets and revenue of Sino-Forest and made materially misleading statements in Sino-Forest's public disclosure record,' alleges the OSC in a 38- page report.
