A Calgary man has agreed to pay $65,000 and accept a five-year trading ban after admitting he bought shares using confidential information about the proposed sale of an oil and gas company.
The Alberta Securities Commission says Colton Kenneth Smith breached provincial securities laws by purchasing shares in i3 Energy plc after receiving non-public information from a former colleague.
Smith worked as an engineer-in-training at i3 Energy Canada Ltd., a subsidiary of the publicly traded company, from September 2020 until November 2023.
Information shared by former colleague
The commission says Smith remained friends with former co-worker Russell Ingram after leaving the company.
Between May 30 and Aug. 14, 2024, the two met socially several times. During those meetings, Smith learned confidential information about i3’s involvement in an ongoing sale process.
The commission says Smith knew Ingram continued to work for i3 Canada and that the information had not been publicly disclosed.
Ingram previously reached a settlement with the regulator for improperly sharing the information.
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Smith purchased i3 shares before the acquisition was announced publicly on Aug. 19, 2024.
The company’s share price increased following the announcement.
Smith did not immediately sell the shares, but the commission estimated his potential profit after the announcement at approximately $29,633.
When the acquisition closed in November 2024, Smith received cash and shares in the company that purchased i3 in exchange for his holdings.
Five-year trading restriction imposed
Under the settlement agreement, Smith will pay $65,000 to the commission, including investigation costs.
He is also prohibited from trading in or purchasing securities and derivatives for five years, subject to limited exceptions.
Cynthia Campbell, the commission’s director of enforcement, said restrictions on trading confidential information apply beyond company executives and employees.
“Confidential information does not become fair game simply because it is passed to a friend, family member or business associate,” Campbell said in a release.
The Alberta Securities Commission is responsible for enforcing provincial securities laws and protecting investors.