Mary G. Condon

The applicant, a minority shareholder, sought standing to bring an application under section 127 of the Securities Act to delay a special meeting and require corrective disclosure in a management information circular regarding a related party transaction.

The respondent brought a motion to deny standing.

The Commission granted the motion and denied standing, finding that the application raised no novel issues, the alleged disclosure deficiencies had already been widely debated in the market, and intervening at a late stage would unduly interfere with the justified expectations of market participants.

The applicants, trustees of Central GoldTrust and Silver Bullion Trust, brought an application to the Ontario Securities Commission regarding unsolicited take-over bids by Sprott.

The applicants argued the bids violated the identical consideration requirement of the Securities Act and were contrary to the public interest due to misleading statements, confusing structure, and a variation amending powers of attorney.

The Commission found it had jurisdiction to hear the application but concluded the bids did not violate the identical consideration requirement.

However, the Commission found the disclosure regarding the variation to the powers of attorney was inadequate and ordered Sprott to issue a notice of change in information providing clear disclosure to unitholders before proceeding with the bids.

Staff of the Ontario Securities Commission brought an application for an inter-jurisdictional enforcement order against the respondents under s. 127(10) of the Securities Act, based on a decision of the Alberta Securities Commission.

The ASC had found that the respondents engaged in unregistered trading, illegal distribution of securities, and fraud, and imposed permanent market bans on the corporate respondents and 10-year bans on the individual respondents.

The OSC found that the respondents' conduct would have constituted breaches of Ontario securities law and that it was in the public interest to protect Ontario investors.

The OSC granted the application and imposed reciprocal trading and registration bans on the respondents in Ontario.

Staff of the Ontario Securities Commission sought an inter-jurisdictional enforcement order against the respondent following a settlement agreement and order by the British Columbia Securities Commission.

The respondent had engaged in unregistered advising in British Columbia.

The Commission found that it was in the public interest to protect Ontario investors and the integrity of Ontario's capital markets by imposing reciprocal sanctions.

The respondent was ordered to cease trading in securities and was prohibited from becoming registered under Ontario securities law for a specified period, mirroring the British Columbia order.

Staff of the Ontario Securities Commission applied for an inter-jurisdictional enforcement order against the respondents under s. 127(10) of the Securities Act, based on a prior order of the British Columbia Securities Commission.

The BCSC had found that the respondents engaged in an illegal distribution of securities and that the individual respondent perpetrated a fraud by misappropriating investor funds.

The respondents did not participate in the written hearing.

The Commission found it was in the public interest to protect Ontario investors and capital markets by imposing permanent trading, acquisition, and director/officer bans on the respondents, mirroring the non-financial sanctions imposed in British Columbia.

The Applicants brought an application to vary freeze directions issued by the Ontario Securities Commission to allow for the payment of $250,000 in legal fees.

The Commission dismissed the application, finding that the frozen funds were raised from investors and that the primary purpose of freeze directions is to preserve assets for potential recovery by investors.

The Commission held that it would be prejudicial to the public interest to allow investor funds to be used to fund the Applicants' legal defence, noting that there is no general right to legal counsel and that the Applicants failed to provide sufficient evidence of a lack of financial means.

The applicant, a mutual fund dealing representative, applied for a hearing and review of a Director's decision suspending his registration for six months.

Over a ten-year period, the applicant had forged client signatures, obtained pre-signed forms, and provided incorrect answers on compliance questionnaires.

The Commission found that the applicant's conduct was fundamentally dishonest, rendering him unsuitable for registration and in breach of Ontario securities law.

The Commission ordered that the applicant's registration be suspended for six months.

The applicant, who was the subject of an ongoing administrative proceeding before the Ontario Securities Commission, brought a motion for disclosure of certain investigation notes prepared by Commission Staff.

The applicant sought to use the notes in parallel civil proceedings.

The Commission found that the notes relating to a bank were compelled evidence under section 13 of the Securities Act, and the applicant failed to meet the heavy burden of demonstrating that disclosure was in the public interest.

The Commission also found that the notes relating to three witnesses were voluntary evidence subject to the implied undertaking rule.

The Commission held that the applicant failed to demonstrate a superior public interest in disclosure that would outweigh the need to protect the integrity of the ongoing investigation and the privacy of the witnesses.

The motion was dismissed.

The Ontario Securities Commission approved a no-contest settlement agreement between Staff and the TD Entities regarding alleged inadequacies in internal compliance systems that resulted in investors being charged inappropriate mutual fund fees.

The TD Entities self-reported the issues, undertook to pay over $13 million in compensation to harmed investors, and agreed to make voluntary payments of $650,000.

The Panel found the settlement to be in the public interest, emphasizing the importance of self-reporting, remediation, and improved compliance systems.

Following a merits decision finding that the Respondents breached the registration and prospectus requirements of the Securities Act, the Ontario Securities Commission held a hearing to determine sanctions and costs.

The Commission first ruled that transcripts from the merits hearing were admissible to provide evidence on sanctioning factors.

The Commission then imposed permanent cease trade orders on the corporate respondent and 10-year cease trade and director/officer bans on the individual respondents.

Administrative penalties totaling $580,000 were ordered against the individual respondents.

The Commission declined to order disgorgement due to uncertainty in calculating the amounts obtained from the illegal conduct.

Costs of $126,216.04 were awarded to Staff, discounted for unproven allegations and unaccepted evidence.

Staff of the Ontario Securities Commission applied for an inter-jurisdictional enforcement order against the respondents under s. 127(10) of the Securities Act, based on a prior order of the British Columbia Securities Commission.

The BCSC had found that the respondents engaged in unregistered trading and illegal distribution of securities.

The OSC found that it was in the public interest to protect Ontario investors and capital markets by imposing reciprocal sanctions.

The OSC ordered that the respondents cease trading in securities and be prohibited from acting as directors or officers of any issuer for a period of five years, subject to limited exceptions.

The Applicants brought a motion requesting the dismissal of the proceeding against them and, alternatively, that the proceeding be heard by another panel member due to a reasonable apprehension of bias.

They also sought to vary a prior interlocutory decision limiting their witness list.

The Ontario Securities Commission dismissed the motion in its entirety.

The Commission held that a motion to dismiss based on the merits of the allegations was premature.

It also found no novel issues or evidence to justify varying the prior witness motion decision under section 78(1) of the Commodity Futures Act.

Finally, the Commission concluded that the Applicants' disagreement with the prior decision did not establish a reasonable apprehension of bias.

The applicants sought a stay of a Director's Decision that permanently suspended their registration as an exempt market dealer and dealing representative, pending a hearing and review by the Commission.

Applying the RJR-MacDonald test, the Commission found there was a serious issue to be tried, the applicants would suffer irreparable harm to their business and livelihood without a stay, and the balance of convenience favoured granting a conditional stay.

The Commission ordered a stay subject to conditions requiring the applicants to post the Director's Decision on their website and provide it to clients.

The Commission also ordered the removal of an Investor Alert from its website but declined to order a retraction.

The applicants, respondents in an enforcement proceeding alleging unregistered trading and advising in commodity futures, brought a motion for direction to summons approximately 700 witnesses for the merits hearing.

The proposed witnesses included 679 account holders, Commission enforcement staff, brokerage executives, and other individuals.

The Commission held that while the threshold for issuing a summons is low, the evidence sought must be relevant and not unduly repetitious.

The Commission found that the applicants failed to demonstrate that all 679 account holders would provide relevant, non-repetitious evidence, but permitted a representative sample to be called.

The requests to summons enforcement staff and other witnesses were denied at this stage due to an insufficient basis demonstrating relevance or necessity.

IIROC Staff applied for a hearing and review of an IIROC Hearing Panel decision that dismissed allegations against TD Securities Inc. (TDSI) for failing to comply with its trading supervision obligations.

The IIROC Hearing Panel had found that several TDSI traders entered artificial closing bids but concluded that TDSI's supervisory system was adequate.

On review, the Ontario Securities Commission found that the IIROC Hearing Panel did not overlook or misapprehend material evidence, nor did it err in law or proceed on an incorrect principle.

The Commission deferred to the IIROC Hearing Panel's factual determinations and its assessment of the adequacy of TDSI's multi-tiered supervisory system.

The application was dismissed.

The applicant sought a temporary cease trade order against an insider bid made by the respondent, alleging the respondent failed to obtain a formal valuation as required by MI 61-101.

The applicant argued the respondent possessed undisclosed material information, specifically confidential power purchase agreement pricing and wind speed data.

The Commission found the applicant failed to provide prima facie evidence that the information was material, noting the applicant's own Directors' Circular stated there was no undisclosed material information.

The Commission dismissed the request for a temporary cease trade order and granted the respondent's cross-motion to dismiss the application.

Following a merits decision finding the respondents engaged in unregistered trading, illegal distribution, and fraud by raising $1,696,750 from over 110 investors for a sham mining operation, the Commission held a sanctions and costs hearing.

The Commission ordered permanent market bans against all respondents, administrative penalties of $300,000 against each of the three individual respondents, disgorgement of the total funds raised on a joint and several basis, and costs of $210,241.39.

Following a merits decision finding the respondents engaged in unregistered trading and illegal distribution of securities, the Ontario Securities Commission held a hearing to determine sanctions and costs.

The Commission imposed permanent trading and director/officer bans on the respondents, with limited carve-outs for RESPs.

The Commission also ordered administrative penalties of $300,000 for Elin and $400,000 for Mellon, and joint disgorgement of $353,229.19.

Staff's request for costs was denied due to an unexplained 18-month delay in the proceedings.

Staff of IIROC applied for a hearing and review of an IIROC Hearing Panel decision regarding Mark Allen Dennis.

The Hearing Panel had found that Dennis misappropriated $1,400,000 from a client and failed to cooperate with an investigation, but capped the fine for misappropriation at $1,000,000, interpreting the sanctioning rule as a penal provision requiring strict construction.

The Ontario Securities Commission allowed the application, finding that the Hearing Panel proceeded on an incorrect principle and erred in law.

The Commission held that IIROC's sanctioning powers are regulatory, not penal, and that 'profit' must be interpreted purposively to include any pecuniary advantage gained.

The Commission substituted its decision, imposing a fine of $1,450,000 for the misappropriation to ensure full disgorgement, alongside a permanent bar, a $25,000 fine for failing to cooperate, and $7,500 in costs.

Following a merits decision finding that the respondents engaged in an illegal and fraudulent distribution of securities that raised $2.1 million from investors, the Ontario Securities Commission held a sanctions and costs hearing.

The Commission ordered permanent market participation bans against all respondents and required them to disgorge the $2.1 million obtained through their non-compliance.

The Commission also imposed administrative penalties of $500,000 on Eatch and $600,000 on McKenzie.

Staff's request for costs was dismissed, as the Commission found the respondents were entitled to a hearing on the fraud allegations.