Lawrence P. Haber

Staff of the Ontario Securities Commission and the respondent audit firm jointly submitted a settlement agreement for approval regarding the respondent's audits of two investment funds.

The respondent admitted to failing to conduct its audits in accordance with generally accepted auditing standards, including failing to obtain sufficient audit evidence, lacking professional skepticism, and failing to complete required engagement quality control reviews.

The Commission approved the settlement, finding it in the public interest, and ordered the respondent to be reprimanded, pay an administrative penalty of $3.5 million, and pay costs of $500,000.

Staff of the Ontario Securities Commission alleged that Money Gate Mortgage Investment Corporation (MGMIC), Money Gate Corp. (MGC), Morteza (Ben) Katebian, and Payam Katebian engaged in unregistered trading, illegal distributions, and fraud.

The Commission found that MGMIC, Ben, and Payam engaged in the business of trading in securities without registration and distributed securities without a prospectus or valid exemptions.

Furthermore, the Commission concluded that all four respondents perpetrated a fraud on investors by failing to disclose the true nature of MGMIC's operations, failing to abide by lending parameters, and improperly diverting loan advances to the benefit of the respondents or their controlled companies.

The Applicants sought a hearing and review of a decision by the Director of the Ontario Securities Commission refusing to issue a receipt for The Bitcoin Fund's prospectus.

The Director had refused the receipt on the grounds that bitcoin is an illiquid asset under NI 81-102 and that issuing the receipt was not in the public interest due to concerns about valuation, safeguarding of assets, and auditability.

The Commission set aside the Director's decision, finding that Staff failed to prove bitcoin is an illiquid asset given the evidence of substantial trading volumes on regulated exchanges.

The Commission also found that the Applicants had taken reasonable steps to mitigate operational risks through the fund's static buy-and-hold structure, the use of a regulated index for valuation, and the engagement of professional custodians and auditors.

The Director was ordered to issue a receipt for the prospectus.

Staff of the Ontario Securities Commission applied to revoke a confidentiality order made during a privilege motion brought by the respondent.

The panel had previously dismissed the privilege motion, finding that solicitor-client privilege did not apply.

As privilege was the sole basis for the confidentiality order, and the respondent did not oppose the application, the Commission found it would not be prejudicial to the public interest to revoke the order.

The application was granted, and the exhibits, submissions, and transcripts from the privilege motion were ordered to be made public.

Staff of the Ontario Securities Commission sought an inter-jurisdictional enforcement order against the respondent under s. 127(10) of the Securities Act, based on a decision of the British Columbia Securities Commission.

The BCSC had found that the respondent engaged in unregistered advising, made misrepresentations, and perpetrated a fraud, resulting in massive harm to investors.

The OSC found that it was in the public interest to issue a reciprocal order to protect Ontario capital markets.

The OSC permanently prohibited the respondent from trading in securities, acquiring securities, and acting as a director, officer, registrant, or promoter.

The Filer, MPX Bioceutical ULC, applied for an order to cease to be a reporting issuer in all jurisdictions of Canada where it is a reporting issuer.

The Filer was formed through an amalgamation pursuant to a plan of arrangement, after which its outstanding securities were exchanged or assumed by iAnthus Capital Holdings, Inc. The Filer's shares were delisted from the CSE and OTCQX.

The Ontario Securities Commission granted the order, finding that the Filer met the test under the securities legislation to cease being a reporting issuer.

The Filer applied for exemptive relief on behalf of several investment funds to permit them to invest in 'Blocker' entities.

The relief sought exemptions from the substantial security holder restrictions under the Securities Act and the consent requirements under NI 31-103.

The Blockers are used to minimize foreign tax filing obligations and ownership restrictions.

The Ontario Securities Commission granted the requested relief, subject to conditions ensuring the transactions are at fair market value, uninfluenced by related entities, and compatible with the funds' investment objectives.

Staff of the Ontario Securities Commission sought an inter-jurisdictional enforcement order against the respondent under subsection 127(10) of the Securities Act, based on a prior decision of the British Columbia Securities Commission (BCSC).

The BCSC had found that the respondent perpetrated a fraud on an investor and imposed permanent market prohibitions.

The Ontario Securities Commission found it in the public interest to issue a reciprocal order, permanently prohibiting the respondent from trading in securities or derivatives, acquiring securities, and acting as a director, officer, registrant, or promoter in Ontario.

Staff of the Ontario Securities Commission sought an inter-jurisdictional enforcement order against the respondent under subsection 127(10) of the Securities Act.

The respondent had previously entered into a settlement agreement with the British Columbia Securities Commission, admitting to misrepresentations to investors and breaching a cease trade order.

The Commission found that the threshold for a reciprocal order was met and that it was in the public interest to protect Ontario capital markets.

The Commission granted the order, imposing trading and market-access bans substantially mirroring those in the British Columbia settlement agreement.

Staff of the Ontario Securities Commission sought an inter-jurisdictional enforcement order against the respondent pursuant to subsection 127(10) of the Securities Act.

The respondent had previously entered into a settlement agreement with the British Columbia Securities Commission, admitting to misrepresentations and breaching a cease trade order.

The Ontario Securities Commission found that the threshold for a reciprocal order was met and that it was in the public interest to issue an order.

The Commission imposed trading and market-access bans on the respondent, substantially mirroring the sanctions agreed to in British Columbia.

Staff of the Ontario Securities Commission alleged that a reporting issuer and seven of its former officers and directors contravened Ontario securities law by making materially misleading disclosures regarding copper production and financial performance, failing to maintain adequate internal controls, and providing inadequate risk disclosure.

The respondents admitted to the contraventions and to conduct contrary to the public interest.

The Commission approved a settlement agreement requiring the corporate respondent to make a $28.5 million voluntary payment and pay $1.5 million in costs, while the individual respondents agreed to pay administrative penalties ranging from $350,000 to $2.45 million, pay $50,000 each in costs, and be subject to director and officer bans.

The Commission found the settlement fell within a range of reasonable outcomes and was in the public interest.

The Ontario Securities Commission approved a settlement agreement between Staff and Questrade Wealth Management Inc. Questrade admitted to acting contrary to the public interest by failing to take appropriate steps to determine whether a conflict of interest existed before investing client money in WisdomTree ETFs.

The Commission ordered a reprimand, $100,000 in costs, and accepted a voluntary payment of $2.9 million, finding the settlement reasonable and in the public interest.

A minority shareholder of the respondent company brought an application under s. 127 of the Securities Act seeking to block a going-private transaction structured as a plan of arrangement.

The applicant alleged the controlling shareholders improperly relied on the 90 percent exemption from minority approval requirements by engaging in a multi-step strategy to dilute minority interests.

The Commission dismissed the application for standing, finding that the applicant delayed in bringing the application, failed to establish a prima facie case of abusive conduct, and had adequate alternative remedies under the CBCA to address concerns regarding price and fairness.

Staff of the Ontario Securities Commission and the respondents entered into a settlement agreement regarding allegations of market manipulation.

During the material time, the respondents engaged in approximately 60 incidents of "spoofing" on the Montreal Exchange, using non-bona fide direct electronic access orders to manipulate the National Best Bid or Offer and trade at artificial prices, profiting by approximately $250,000.

The respondents admitted to breaching s. 126.1(1)(a) of the Securities Act.

The Commission approved the settlement agreement, finding the agreed sanctions, which included administrative penalties totaling $970,000, trading bans, and costs of $30,000, to be reasonable and in the public interest.