A B.C. Supreme Court judge has approved a U.S. Securities and Exchange request to freeze houses, vehicles and other assets of at least five British Columbians accused in a $1.3-billion international stock fraud.

The SEC is seeking repayments from an alleged pump-and-dump stock scheme, fines and interest totalling nearly $75 million from the B.C. residents.

A global freeze order has already secured banking and investment accounts totalling $39 million held by the five, but it is short of what the SEC is seeking in the U.S. suit, the ruling shows.

The defendants had opposed the freeze order of B.C. assets — called a Mareva injunction — on various grounds, including that it would violate their Charter rights and a right against self-incrimination.

B.C. Supreme Court Justice Amy Francis ruled there was no basis for denying the freeze order on those arguments. In her ruling, Francis noted there was some evidence on face value to support the defendants were involved in a complex securities fraud scheme that involved shell companies, secret encrypted communications, and a clear pattern of deceptive behaviour. The U.S. case has not been decided yet, which the defendants are fighting.

The March 21 B.C. Supreme Court ruling also approves the SEC’s request for the accused in B.C. to disclose all assets.

“Considering the conduct alleged, the type of assets involved, and the general circumstances, I find this case to be an appropriate one to draw the permissible inference that the alleged fraudulent activities of the defendants give rise to a risk of dissipation,” Francis said in her 26-page ruling.

The five covered by the freeze order in B.C. are Jackson T. Friesen, 34, of Vancouver; Paul Sexton, 54, of Anmore; Courtney Kelln, 42, of Surrey; Mike K. Veldhuis, 42, of Vancouver; and Zhiying (Yvonne) Gasarch, 50, of Richmond.

Two others the SEC is seeking to be covered by the freeze order — Frederick L. Sharp, 70, of West Vancouver, and Graham R. Taylor, 52, of Vancouver — will face a hearing at a later date.

On the list of assets sought to be frozen is a five-bedroom, six-bathroom Okanagan Lake waterfront home owned by Sexton, valued at $8.54 million, according to B.C. Assessment Authority records.

A four-bedroom, four-bathroom home in Vancouver near Kitsilano beach owned by Friesen was also on the list of assets the SEC sought frozen. But property records show the home was sold for $3.3 million on Sep. 23, 2022, just six weeks after the SEC’s application was filed in B.C. Supreme Court.

Vehicles are owned by Veldhuis, Kelln and Sexton, according to the SEC’s court filings. Gasarch is listed as a debtor in a B.C. personal property directory, with shares in a company as collateral.

The SEC‘s U.S. suit seeks the payback of “ill-gotten gains” and monetary penalties.

Sharp argues he was denied “procedural fairness,” not properly served notice of the U.S. court proceedings, and that the U.S. court action has no jurisdiction over him.