May 23, 2012 / 2:13 PM / in 6 years

Sino-Forest says reviewing regulator's allegations

TORONTO, May 23 (Reuters) - Sino-Forest Corp said on Wednesday it is reviewing fraud charges leveled against it by the Ontario Securities Commission and considering what steps, if any, it ought to take in response to the allegations.

The embattled Chinese forestry company, whose stock imploded last year in the face of fraud allegations, said the regulator is seeking penalties of up to C$1 million for each alleged failure by the company to comply with Ontario securities law.

The OSC, Canada’s most powerful securities regulator, is also seeking to permanently halt trade in shares of Sino-Forest.

The shares have been temporarily cease-traded since last August, and were de-listed by the Toronto Stock Exchange earlier this month after a court granted the company creditor protection.

Sino-Forest said the creditor protection proceedings for now prohibit the OSC from enforcing any monetary penalties on the company.

The OSC charged Sino and some of its former executives with fraud on Tuesday. The OSC said the company and its former management engaged in numerous “deceitful and dishonest” actions connected with its purported purchase and sale of timber in China.

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