A former Abbotsford man now living in White Rock has pleaded guilty to one count of contravening the B.C. Securities Act.
The sentencing hearing for Richard Gozdek, 56, is scheduled to take place in Abbotsford provincial court on Dec. 23, at which time two other counts of contravening the Securities Act are expected to be stayed.
Gozdek was charged in December 2018 for failing to comply with a BC Securities Commission (BCSC) order by trading in securities, by acting in a consultative capacity in the securities market, and by engaging in investor relations activities.
In a settlement agreement with the BCSC in 2013, Gozdek agreed to pay approximately $65,000 to the BCSC, and was banned for five years from activities such as trading securities, engaging in investor relations, and acting as a consultant in the securities market.
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At that time, Gozdek admitted that he illegally sold securities in Armadillo – a Nevada corporation that claimed to own an oil lease in Oklahoma, according to a BCSC press release at the time.
The agency said that Gozdek had never been registered to sell securities in B.C., and Armadillo had never filed a prospectus, offering memorandum or exempt distribution report in B.C.
Between December 2010 and April 2011, Armadillo sold partnership agreements to at least 26 investors in B.C. for proceeds of almost $869,000, according to the BCSC.
The agency stated that Gozdek directly solicited people to invest in the partnership agreements, raising almost $551,000 from B.C. residents.
Gozdek, through his company Sterling Financial Group, was paid a fee of just over $40,000 for the sale of the partnership agreements.
Each month Armadillo would extract and sell the amount of oil an investor purchased to a refinery on the investor’s behalf.
According to the investor’s preference, the net proceeds would either then be used to acquire title to an additional quantity of oil, or would be forwarded to the investor in the form of a production payment.
