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by Mike Caswell

The U.S. Securities and Exchange Commission has permanently banned Vitaly Fargesen, the New Jersey man jailed for a fraud at Vancouver's Canafarma Hemp Products Corp. in 2019. The SEC said that he and others raised $15-million while touting a hemp operation that was "just for show." (All figures are in U.S. dollars.) He and others misappropriated money through bogus consulting agreements, taking $4-million altogether, according to the government.

The ban for Mr. Fargesen is contained in a proposed judgment that the SEC filed on Tuesday, Sept. 17, in federal court in New York. The judgment permanently bars him from penny stocks and from serving as an officer or director. He is also liable for disgorgement of $828,287 in gains, plus $144,542 in interest. The penalties represent a negotiated settlement, and still require approval from the judge.

For Mr. Fargesen, the sanctions come as he is serving a five-year jail term that he received in a parallel criminal case. There was no trial, as he pleaded guilty. He explained that his crime occurred when he was in a "dark place in life." In 2018, he discovered that one of his children had an opioid addiction. Mr. Fargesen also underwent a failed hernia surgery in 2020. The surgeon failed to insert a mesh used to stabilize the hernia, resulting in the hernia spreading to his groin area, he said.

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