Ontario Tribunal Finds Film Financier Jason Cloth Committed Securities Fraud
The Ontario Capital Markets Tribunal ruled that film financier Jason Cloth and his company, Creative Wealth Media Finance Corp., committed securities fraud by misappropriating investor funds, diverting $53.8 million to real estate projects, and operating a Ponzi-like scheme. Cloth, who was arrested in the United States on wire fraud charges in July, faces a sanctions hearing no later than Nov. 30.
The Ontario Capital Markets Tribunal has found that 60-year-old film financier Jason Cloth and his company, Creative Wealth Media Finance Corp., perpetrated securities fraud by misappropriating investors’ funds. Cloth holds executive producer credits on films such as Joker and House of Gucci.
According to the tribunal’s findings, $53.8-million of investors' money was improperly diverted to a real estate development company called Conacher Kingston and a construction company named Olympus Home. The Ontario Securities Commission (OSC) argued that from 2018 onward, Creative Wealth was sustained through Ponzi-like payments. The tribunal determined that between October 2018 and the end of 2021, Cloth used money raised for specific media projects to fund other media projects. In one instance, out of approximately US$7.9-million raised in a Series E financing round, at least $4.19-million went to repaying earlier investors.
Creative Wealth entered bankruptcy proceedings in October 2023.
In July, Cloth was arrested in the United States on seven counts of wire fraud, each punishable by up to 20 years in federal prison. The U.S. Attorney’s Office for the Northern District of Illinois is handling the criminal case.
During the tribunal proceedings, Andrew Guaglio, a lawyer at Fenton Law Barristers, sought to be removed as counsel for Cloth due to a breakdown in the solicitor-client relationship. The tribunal granted the request.
A hearing to consider costs and sanctions against Cloth and Creative Wealth will be held no later than Nov. 30.