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by Mike Caswell

Vancouver-area resident Paul Sexton is appealing an $18.9-million judgment that the U.S. Securities and Exchange Commission won against him for a 2014 scheme on the OTC Markets. (All figures are in U.S. dollars.) The SEC claimed that Mr. Sexton was one of several stock promoters who violated U.S. laws by unloading shares through a network of offshore nominees run by West Vancouver's Frederick Sharp. The selling came amidst paid tout sheets that made claims such as "Get in now; this is huge!"

Word of Mr. Sexton's appeal comes just weeks after the SEC won a judgment against him. That decision, handed down on June 20, 2024, ordered Mr. Sexton to disgorge up to $17.36-million and directed him to pay a $1.56-million fine. The judgment also permanently barred him from penny stocks.

As Mr. Sexton sees things, the judge did not properly apply the law in handing down the sanctions. In a motion filed on Thursday, July 18, he attacks the largest part of the judgment, the $17.36-million disgorgement award. He says that the judge failed to "require the SEC to demonstrate both that Mr. Sexton actually received the disgorgement amount requested by the SEC and that all such funds were received by Mr. Sexton in connection with a violation of the federal securities laws."

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