MINING MARKETS & INVESTMENT NEWS – First Marathon settles final Cartaway hearing

First Marathon Securities has agreed to donate $450,000 to the Mineral Deposit Research Fund (MDRU) at the University of British Columbia and pay $50,000 in investigative costs as part of its final settlement in the Cartaway Resources scandal.

The settlement with the British Columbia Securities Commission concludes all regulatory proceedings related to Cartaway. First Marathon and certain of its insiders previously settled proceedings launched against them by the Toronto Stock Exchange and the Ontario Securities Commission by agreeing to hefty fines and other penalties.

First Marathon acknowledged it had breached securities regulations when a group of brokers in the firm bought control of the junior in late 1994 and 1995. The shares peaked at $26 based on promotion of visual assays from drill core but dropped to $2 after the poor assay results were released.

The firm now has rules in place prohibiting insiders from acting as a promoter for any issuer, or from buying shell companies to gain access to public financing. Employees must declare holdings of more than 5% in any company, and the collective holdings of employees must not exceed 19.9% of any public company without the consent of a compliance officer.