British Columbia Securities Commission

British Columbia Securities Commission

January 27, 2010 09:00 ET

British Columbia Securities Commission: North Vancouver Woman Disciplined for Conducting Unregistered Trades

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Jan. 27, 2010) - The British Columbia Securities Commission has settled with a former mutual fund salesperson who admitted that she helped to distribute the securities of an offshore company without proper registration and without filing a prospectus.

In the settlement agreement, Cheryl Anne Kyllo admitted she communicated with investors in Mercury Capital S.A., a Turks and Caicos company, on behalf of her father-in-law, Steven Peter Kyllo. She also admitted to processing paperwork and signing primary investment documents for five investors, who collectively invested US $100,000.

During the distribution, which occurred between June and August 2005, Mercury Capital sold at least US $534,572 of its securities to at least 22 investors. The company promised to pay investors 25 per cent per month for four months with the return of the entire principal at the end of the fourth month.

At the time, Cheryl Kyllo, a North Vancouver, B.C. resident, held registration that did not allow her to trade the Mercury Capital security. She was restricted to trading mutual funds. Furthermore, Mercury Capital has never filed a prospectus to distribute its securities in B.C.

Under the settlement agreement, Cheryl Kyllo is restricted for four years from trading exempt-market securities (those that qualify for prospectus exemptions, for example) except in the course of her employment with a registered dealer and only with clients of that dealer.

During the BCSC investigation, she spent 17 months without registration and had her licence restricted by the requirement of strict supervision for a further 15 months. Cheryl Kyllo also invested her own money, which was lost.

On May 27, 2009, the executive director issued a notice of hearing against Steven Kyllo and Mercury Capital. The hearing is scheduled to begin on March 3, 2010. The allegations against Steven Kyllo, Mercury Capital and other respondents named in the notice have not been proven.

The B.C. Securities Commission is the independent provincial government agency responsible for regulating trading in securities within the province. You may view the settlement agreement on our website www.bcsc.bc.ca by typing in the search box, Cheryl Anne Kyllo or 2010 BCSECCOM 46. If you have questions, contact Ken Gracey, media relations, 604-899-6577.

Learn how to avoid investment fraud at the BCSC's investor education website: www.investright.org.

Contact Information

  • British Columbia Securities Commission
    Ken Gracey
    604-899-6577 or (Canada) 1-800-373-6393
    www.bcsc.bc.ca