The B.C. Securities Commission has fined two directors of a nearly worthless mining exploration company for not disclosing their insider share sales to authorities.
Richard Ryan Penn and Roman Reuvin Rubin, of Black Tusk Resources Inc., failed to report share transactions valued at close to $1.16 million and $647,000, respectively, on the publicly accessible System for Electronic Disclosure by Insiders (SEDI) between January 2018 and December 2020.
The B.C. Securities Commission (BCSC) reached a settlement agreement whereby Penn, the current company CEO, is to pay a $75,000 fine and complete an educational course on being a responsible public company director. Likewise, Rubin, who left his CFO position with Black Tusk in May 2021, is to pay a $65,000 penalty and complete the same course.
The two were also deemed liable for Black Tusk falsely stating the amount of shares they held.
As an example, according to the settlement notice issued Jan. 6, in October 2019, the company falsely stated Penn held 2,924,500 Black Tusk shares when he actually held only 1,093,725; and in November 2020, the company falsely stated Penn held 5,014,500 shares when he actually held only 505,075.
Penn and Rubin, who cooperated with the commission, have since made the required filings and Black Tusk has published news releases correcting the disclosure of their shareholdings, according to the notice.
However, it’s unclear how much net profit the directors may have earned from selling their shares.
Black Tusk is a junior mineral exploration company, with its shares listed on the Canadian Securities Exchange.
Since Penn took over as CEO in 2017 the company’s yet to realize any revenue, has limited resources and no sources of operating cash, according to its 2021 annual audit last April showing a net loss of $3.28 million.
In 2021 (financial year), the company spent $1.8 million on consulting fees, and $322,194 on advertising and promotion among other expenses. The latest news from the company is that it has obtained a diamond drilling permit north of Val d’Or, Quebec.
And, aside from the shares they hold, which are now valued at three cents, Penn and Rubin both took home salaries of $120,000 cash in 2020, according to the latest management filings.
Penn and Rubin previously directed Rain City Resources Inc. and Maccabi Ventures Inc. together. From 2009 to 2013, Penn, of Surrey, was an investment advisor for Mackie Research Capital Corp. From September 2010 to September 2013, Rubin, of Burnaby, worked as VP of wealth management at League Investment Services.
The full settlement notice can be seen on the commission’s website.
