Former Oilers owner Pocklington charged in U.S.
Former Edmonton Oilers owner Peter Pocklington has been accused of securities fraud in the United States for allegedly hiding his criminal history and misappropriating investor funds.
Pocklington pleaded guilty to perjury in 2010 for lying under oath in a bankruptcy case and was sentenced to two-years probation and community service, according to allegations released Thursday by the Securities and Exchange Commission (SEC).
Three years later, he was ordered to pay more than US$5 million as part of a settlement of unrelated Arizona securities fraud and registration charges related to two mining companies, the complaint says.
He founded California-based The Eye Machine in 2014, which raised more than US$14 million over the next three years from more than 260 investors, the complaint says.
According to the SEC, Pocklington and his attorney, Lantson E. Eldred, structured ownership of the company, which was started to develop a device to treat the eye disease macular degeneration, to conceal Pocklington’s role.
In the offerings, Pocklington, Eldred and The Eye Machine (now known as Nova Oculus Partners) failed to disclose Pocklington’s “checkered history” and involvement, and misrepresented how investor funds would be spent, the complaint says.
Pocklington, 76, allegedly participated in misappropriating more than US$600,000 of investor funds for personal use, including funding his gold mining companies and paying personal legal and creditcard bills, the complaint says.
It also claims The Eye Machine paid millions of dollars in undisclosed and excessive sales commissions to three people, one a repeat securities law violator, who acted as unregistered brokers for the company. Two of them allegedly used a Florida “boiler room” — which usually describes sales centres using aggressive or unethical tactics — to cold-call investors.
The SEC complaint charges The Eye Machine, Pocklington and Eldred with violating the anti-fraud and securities registration provisions of federal securities laws.
Company owner AMC Holdings, indirectly owned by Pocklington’s wife, Eva, and The Eye Machine’s accountant are also accused of securities fraud violations, the complaint says.
None of the accusations has been proven in court.
Pocklington, who couldn’t be reached for comment and hasn’t filed a defence, sold the Oilers in 1998 and later moved to Palm Desert, Calif.
Last October, an Edmonton judge blocked his attempt to cut a deal on $21.5 million he owes the Alberta government and other creditors in a dispute that began in the 1980s.