Decision in brief: Gong, Enforcement Proceeding, Motion on use of documents, February 3, 2023
OSC staff started an investigation and brought a case in criminal court (separate from this Tribunal) against Xia Hua (Edward) Gong and Edward Enterprise International Group Inc. (“Edward Group”). Edward Group pled guilty in criminal court to operating a pyramid scheme and using forged documents. The Crown withdrew the criminal charges against Gong.
OSC staff then started this Tribunal proceeding against Gong about the same activities as in the criminal case. Gong is asking this Tribunal to restrict OSC staff’s use of documents gathered for the criminal proceeding. Specifically, Gong is asking to follow a process that was used in the court case D.P. v Wagg. Under that process, OSC staff would have to either get the Crown and police’s permission to use the documents or get permission from the court.
The Tribunal decided that the Wagg process does not apply in this case because of one major difference: this case involves information that OSC staff collected during its own investigation, but Wagg involves information that the Crown and the police collected and gave to the accused person. In this case, there is no risk that Staff would use “confidential Crown information”. Also, the normal protections that apply to confidential materials in other OSC investigations under the Securities Act still apply here.