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U.S. Securities and Exchange Commission


Litigation Release No. 20656 / July 29, 2008

Securities and Exchange Commission v. George J. Simchuk, Civil Action No. 08-cv-6728 (DLC) (S.D.N.Y., filed July 29, 2008)

Former Mining Manager Settles Charges with SEC for Trading on Inside Information

The Securities and Exchange Commission ("Commission") today announced that it has filed a complaint in the United States District Court for the Southern District of New York against George J. Simchuk ("Simchuk") alleging that he engaged in unlawful trading on the basis of material, nonpublic information in the securities of Western Silver Corp. ("Western Silver"). Without admitting or denying the allegations in the Commission's complaint, Simchuk has agreed to settle this matter by consenting to the entry of a final judgment against him which imposes injunctive and monetary relief.

The complaint alleges that in late November 2005, Simchuk, former General Director of Glamis de Mexico, a wholly-owned subsidiary of Glamis Gold, Inc. ("Glamis," now Goldcorp, Inc.), learned material, nonpublic information concerning Glamis' plan to acquire publicly traded Western Silver. The complaint further alleges that Simchuk learned of the potential acquisition in connection with his official duties assisting in the due diligence process on behalf of Glamis. A few days later, on December 1, 2005, Simchuk began purchasing Western Silver stock. From December 2005 through February 2006, during which time he remained privy to material, nonpublic information concerning Glamis' potential acquisition of Western Silver, Simchuk intermittently purchased a total of 6,000 shares of Western Silver stock. According to the complaint, one of the purchases occurred while Simchuk was in attendance at a Glamis Board meeting at which he and others presented the due diligence findings with respect to Western Silver. On February 24, 2006, Glamis announced that it had signed a binding letter agreement to acquire Western Silver. By market close on February 24, news of the deal pushed the share price of Western Silver to $21.60, up 27% from its closing price the previous day.

Based on the facts alleged, the Commission charged Simchuk with violating Section 10(b) of the Securities Exchange Act of 1934 ("Exchange Act") and Rule 10b-5 thereunder. Without admitting or denying the allegations in the complaint, Simchuk has consented to the entry of a final judgment that: (i) permanently enjoins him from future violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder; (ii) requires him to disgorge $58,206, plus prejudgment interest thereon in the amount of $10,270, and (iii) orders him to pay a civil penalty of $58,206.

The Commission acknowledges the assistance of the Financial Industry Regulatory Authority in the investigation of this matter.

SEC Complaint in this matter



Modified: 07/29/2008