(Bloomberg) -- A trader in Canada received a four-year jail sentence after accepting millions of dollars from investors, then giving them false information about their returns.
An Ontario court handed down the penalty to Nathanael Anthony Aikman, who pleaded guilty in November to fraud and trading securities without registration. He has also been ordered to pay restitution of more than C$3.9 million ($2.9 million).
Aikman was one of the founders of Yonge Street Capital LLC, which purported to be a hedge fund that invested in various securities and cryptocurrencies, according to a Tuesday statement from the Ontario Securities Commission. Over a period of almost three years, Yonge Street — named after the street that divides Toronto’s east and west sides — took in more than C$6.2 million from 71 investors, the regulator said.
Aikman developed a structure at the fund that he claimed would guarantee a 25% return on investment, according to documents filed by the regulator in a related case. But much of the money “was used by Mr. Aikman for purposes unrelated to YSC’s business, and to the detriment of investors,” the Ontario commission said.
His partners in the business, Syed Saad Aziz and Jazib Ali Khan, were both convicted of unregistered trading, but neither was found guilty of fraud.
Aikman was the only person with access to Yonge Street Capital’s brokerage account, and his other partners could monitor the fund’s performance only through a spreadsheet, the securities regulator said in documents filed in 2021 in the case against Aziz.
Investors were told in August 2019 that their accounts would be liquidated and they would receive their full balance. But Aziz learned that he had been “duped” and that Aikman had falsified the fund’s monthly returns, and filed a complaint with York Regional Police, the regulator has said.
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