CANADIAN STOCKBROKER CONVICTION OVERTURNED

A man's life ruined on the basis of the always-dubious "testimony in exchange for immunity"

The most high-profile stock-tipping conviction in Canada was overturned yesterday by an Ontario judge who said that Andrew Rankin may be the victim of a "miscarriage of justice" and should get a new trial. Mr. Justice Ian Nordheimer of the Ontario Superior Court ruled the provincial judge who sentenced Mr. Rankin to six months in jail for insider tipping in July, 2005, had made legal errors and relied too heavily on the testimony and credibility of Daniel Duic, Mr. Rankin's childhood friend who testified as the star witness for the Ontario Securities Commission in exchange for immunity. Judge Nordheimer raised doubts about the credibility of Mr. Duic's testimony and said the OSC must now decide whether it is "in the public interest" to pursue a fresh trial against the 41-year-old former Bay Street investment banker.

The OSC can also appeal Judge Nordheimer's ruling, which emerged 16 months after Mr. Rankin was found guilty of "tipping" confidential information to Mr. Duic. The OSC alleged Mr. Rankin -- who has been free on bail pending his appeal -- passed on insider information about coming takeover and merger deals to his friend, who made more than $4-million in profit on a series of stock trades in 2000 and 2001. The regulator claimed that Rankin tipped Duic about impending transactions, including the reorganization of Canadian Pacific Ltd., Shaw Communications Inc.'s $992-million acquisition of Moffat Communications Ltd. and De Beers Consolidated Mines Ltd.'s $174-million acquisition of Winspear Diamonds Inc.

Mr. Duic bought shares in those companies before the transactions were made public and sold them at a profit afterward, OSC lawyer Kelley McKinnon said at Mr. Rankin's trial. Ms. McKinnon said Mr. Duic spent as much as $100,000 on shares of such companies as Prudential Steel Ltd., which was bought by Maverick Tube Corp. in 2000 for $521-million, and Cobequid Life Sciences Inc., which was bought in that same year for $21-million by Novartis AG.

Mr. Rankin was cleared of more serious insider-trading charges. However, he appealed his tipping conviction. "With the numerous deficiencies in Daniel Duic's testimony ... I fear there may have resulted a miscarriage of justice in this case," Judge Nordheimer said. Ms. McKinnon -- who wanted Mr. Rankin slapped with a three- to five-year prison sentence -- said she will consider Judge Nordheimer's ruling before "assessing the appropriate next steps."

Friends and relatives hugged Mr. Rankin after the judge threw out his conviction, handed down more than a year ago by Mr. Justice Ramez Khawly. "I'm absolutely delighted," said Dr. John Rankin, the man's father. "It's been miserable ... and this has been very, very hard on Andrew knowing that he was not guilty and was betrayed by his old friend." Mr. Rankin has been unable to land a job in Toronto so he moved to Los Angeles with his wife and found work assisting relatives of hospital patients, his father said. Described by one relative as a "pariah" on Bay St., Mr. Rankin was making $1-million annually with RBC's investment-banking unit before he was fired in 2001.

Report here



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