Canadian stockbroker Robertson Roger Dow has been banned from the securities business and fined more than $600,000 after a Canadian securities regulator ruled that he had secretly conducted trading of HiEnergy Technologies stock on behalf of American fraudster Phil Gurian.

Trading of that over-the-counter bulletin board stock was previously the subject of an American subpoena for information served on Bermuda investment firm Lines Overseas Management and its co-founder Scott Lines.

In 2004, the US Securities and Exchange Commission served Mr. Lines with a subpoena seeking documents which would ?assist in establishing whether Gurian or related persons or entities profited from Gurian?s fraudulent undisclosed control of HiEnergy by selling its stock through LOM, and whether any person or entity, including possibly Gurian or LOM, manipulated HiEnergy stock.?

LOM previously told this newspaper that it found no evidence of any improper trading through LOM accounts, and no evidence whatsoever that Mr. Gurian or his associates have any connection to any accounts at LOM.

The SEC has since withdrawn its application with a US District Court to enforce the HiEnergy subpoenas on the grounds that it no longer needed information from LOM ?based on recent developments unrelated to this action.?

Other court action against LOM related to a separate securities investigation is continuing.

This newspaper has been unable to establish how closely the US and Canadian HiEnergy probes are linked however the Investment Dealers Association of Canada has said that it commenced its investigation after being alerted to an SEC probe of apparent fraudulent activities by American residents with the apparent assistance of registered IDA member firms.

This week, an IDA panel fined Dow $150,000 after ruling the he contravened its bylaws between 2002 to 2004 by engaging in conduct unbecoming or detrimental to the public interest by accepting Mr. Gurian?s trading orders.

The National Association of Securities Dealers permanently barred Mr. Gurian from the securities business in the 1990?s. He later pleaded guilty to fraud charges. In 1999, a grand jury indictment alleged that Mr. Gurian and others including persons tied to organised crime orchestrated a series of ?pump and dump? schemes.

The IDA said Mr. Dow knew or ought to have known that Mr. Gurian had a history of securities violations and or an association with organised crime.

According to the IDA?s evidence, Mr. Dow had said that he learned about Mr. Gurian?s background ? and even read media articles which tied Mr. Gurian to Phil Abramo, a captain in the Decavalcante organised crime family ? however he felt Mr. Gurian was ?an honourable man? in relation to the transactions they did together.

The IDA also fined ow $75 000 for concealing information from his then employer Octagon Capital Corporation. The panel found he had circumvented trading rules preventing him from opening accounts or accepting trades from US resident by opening various accounts in the sole name of Jeanne Schnapik, who is Mr. Gurian?s mother and a resident of the Ontario and Florida.

The IDA fined Dow a further $75,000 for taking trading instruction on six accounts for Benil Finance Ltd. which he opened at Octagon on behalf of individuals who were neither named as trading authorities nor permitted to trade given their US citizenship.

In its own investigation, the SEC alleged that Benil Finance Ltd. was Mr. Gurian?s ?alter ego? through which he secretly controlled and manipulated the stock of HiEnergy. Benil Finance shares a corporate address with a number of offshore firms connected to Mr. Gurian, according to the IDA?s evidence.

The IDA also also gave Mr. Dow a lifetime ban from registering as a stockbroker. In addition to the $300,000 total fine, he must disgorge $361,000 in commissions which he earned during the two years that he traded for the seven accounts.

Mr. Dow may appeal the IDA?s ruling to the IDA or to the Ontario Securities Commission. If his appeal is unsuccessful, he can turn to the courts.

The IDA has served Octagon Capital Corporation with a notice of hearing for allegedly failing to properly supervise Mr. Dow. A spokesperson would not disclose whether the IDA is investigating any other firms or persons in relation to its probe of HiEnergy trades.