Second TD investor alleges fraudulent trades involving obscure Chinese stock — SkimNews
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- Ray Politeski, a retired teacher in Lloydminster, Alberta, says scammers sold his equity holdings worth ~$234,000 and used the proceeds to buy ~$355,000 of Rich Sparkle Holdings shares on Feb. 13, leaving him with a stated loss of roughly $93,000.
- The Politeski incident came one day after Tim Tycholis, a Calgary oil and gas entrepreneur, says the same fraud pattern hit his TD account, involving more than $5-million in Rich Sparkle Holdings shares and a roughly $4.5-million loss.
- Rich Sparkle Holdings (Nasdaq: ANPA), described as a Chinese financial printing and corporate-services provider, saw its share price soar more than 550% in early January before plummeting from Feb. 10, with eight NYSE trading halts on Feb. 13 alone.
- Fraudsters gained access to Politeski's account after he entered his TD confirmation password into what he described as an 'official-looking prompt' and was immediately locked out of his account.
- TD called Politeski within an hour and restricted his account, but permitted the Rich Sparkle purchase to proceed even though it exceeded his cash account's available funds by roughly $113,000 — a feature of cash accounts Politeski said he was unaware of.
- TD has denied liability in both cases, telling The Globe valid login credentials were used; Tycholis has filed suit in Alberta's Court of King's Bench, while Politeski awaits a third internal review of his escalated complaint.
- Harold Geller, an Ottawa-based financial loss litigation lawyer, said dealers already have authority to delay suspicious trades but current Canadian regulations say little about when financial institutions should be expected to pause unusual activity.
Why it matters: TD's denial of liability in two near-identical Alberta frauds — both citing 'valid login credentials' as the defense — exposes a regulatory gap: combined losses top $4.6 million, yet current rules say little about when broker-dealers must pause suspicious trades, per Ottawa litigator Harold Geller.
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