Mining execs fined, banned for disclosure failings

By James Langton | February 22, 2022 | Last updated on February 22, 2022
2 min read
© Burmakin Andrey / 123RF Stock Photo

Regulators have fined and permanently banned a pair of junior mining executives for misleading investors by failing to disclose crucial information about their company’s only asset.

A hearing panel of the British Columbia Securities Commission (BCSC) permanently banned Zahir “Zip” Dhanani and Robert Nasoat, former executives with now-defunct mining exploration company Arian Resources Corp. They were each ordered to pay $200,000 in penalties, and the company was also banned.

The sanctions follow a disciplinary hearing that found they violated securities laws by failing to disclose material changes in the company’s business, filing financial statements that omitted material information, and misstating executive compensation.

According to the BCSC, between 2014 and 2017, “Arian failed to properly disclose a growing list of risks and challenges to its only material asset” — an Albanian mining project — until the asset was effectively worthless.

“The risks to the value of that asset continued until the risks were realized and no value remained,” the panel said in its decision.

“The public was not told of those risks until it was too late,” it added. “That failure to make timely and accurate disclosure completely undermined the purpose of the continuous disclosure regime that lies at the heart of securities regulation.”

The disclosure failures created risks to investors and to public confidence in the market, it said. “This case demonstrates clearly why disclosure is important to investors and to markets,” the panel said.

While the disclosure failings involving executive compensation were less serious, the panel said that they “reinforce the impression, which we find is well justified, that Arian and its officers and directors, Dhanani and Naso, did not take their disclosure obligations seriously.”

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James Langton

James is a senior reporter for and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.