Drabinsky Hit With Markets Ban 16 Years After Fraud Case Began

Jun 17, 2017 3:03 am ET

(Bloomberg) -- Garth Drabinsky has been banned from capital markets some 16 years after a Canadian regulator first began its probe of the former theater executive who was convicted of carrying out one of the biggest frauds in Canadian history.

Drabinsky was barred from serving as a director or officer of a publicly traded company, and prohibited from trading securities except in his own personal account or registered pension plan, the Ontario Securities Commission said in a statement Friday. Drabinsky’s lawyer, Richard Shekter, didn’t immediately respond to requests for comment

“Mr. Drabinsky was responsible for one of the most significant Canadian financial frauds in recent decades,” the commission wrote.

The ruling brings to an end a process that began in 2001 when the regulator first made allegations against Drabinsky, co-founder of production company Livent Inc. The regulator’s case was pre-empted by criminal proceedings, in which Drabinsky was eventually sentenced to five years imprisonment. He completed his sentence in September.

“It is not in the public interest to allow Mr. Drabinsky’s participation in Ontario’s capital markets as he was a senior director and officer of a public company who abused his positions of trust by carrying out a large-scale fraud,” the Toronto-based commission wrote.

Drabinsky and partners founded Livent in 1990, expanding it into North America’s biggest theatrical producer, with shows including “Ragtime,” “Fosse” and “The Phantom of the Opera.”

Drabinsky, onetime chief executive officer, was charged in 2002 with lying about company finances for nine years after the company raised about C$500 million ($378 million) in public markets to buy theaters and put on shows.

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