Derek James Ferris

The Divisional Court issued supplementary reasons to clarify its earlier decision partially allowing the appellant's appeal from an Ontario Securities Commission decision.

The original appellate decision set aside specific ten-year bans and an administrative penalty, remitting them for a fresh determination.

Upon request for clarification, the Court agreed with the parties that the remedy should apply to all ten-year bans imposed on the appellant.

The earlier decision was amended to set aside all such bans and remit them to the Commission.

The respondent McKinnon brought a motion seeking a preliminary determination to dismiss allegations relating to Principal Protected Notes (PPNs) prior to the hearing on the merits, or alternatively, a declaration that it is not in the public interest to hear the PPN Allegations.

The Ontario Securities Commission dismissed the motion, finding that the issues raised were of mixed fact and law that could not be resolved without regard to contested facts and anticipated evidence at the hearing on the merits.

The Commission also held that there was no compelling public interest consideration to decline hearing the allegations.

The appellants appealed three decisions of the Ontario Securities Commission regarding a sanctions hearing.

After a merits hearing found the appellants contravened the Securities Act, the terms of the presiding panel members expired.

The OSC appointed a new panel for the sanctions hearing.

The appellants argued the original panel's terms were deemed extended under s. 4.3 of the Statutory Powers Procedure Act.

The Divisional Court dismissed the appeal, holding that the OSC's interpretation of its own procedures and the SPPA—that the merits and sanctions hearings were separate—was reasonable.

The court also upheld the admission of merits hearing transcripts and the ultimate sanctions imposed.

Stuart McKinnon brought a motion seeking an order under section 147 of the Securities Act to exempt him from registration requirements and grant him registration as a mutual fund dealing representative pending the determination of enforcement allegations against him.

Staff opposed the motion, arguing the Commission lacked jurisdiction and that granting the exemption would be prejudicial to the public interest given past compliance issues.

The Commission dismissed the motion, finding that assessing suitability for registration requires a detailed evidentiary record and that it would not be in the public interest to bypass the statutory registration requirements.

The appellant appealed a decision of the Ontario Securities Commission finding him liable for unregistered and illegal trading of securities and imposing sanctions.

The Divisional Court upheld the Commission's findings on liability, concluding it was reasonable to find the appellant engaged in acts furthering trade and received commissions.

However, the court found the Commission erred in its sanctions analysis by misapprehending the timing of a previous ban imposed on the appellant in Alberta.

The appeal was allowed in part, with the trading bans and administrative penalty set aside and remitted to the Commission for a fresh determination.

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.

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

The Commission ordered permanent and long-term trading, acquisition, and exemption bans against the corporate and individual respondents, along with director and officer bans.

The Commission also ordered administrative penalties totaling $935,000, disgorgement of over $2.5 million, and costs of $305,000, finding that the respondents' conduct was serious, deceitful, and caused substantial harm to investors.

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 Ontario Securities Commission held a merits hearing regarding allegations that Juniper Fund Management Corporation, its principal Roy Brown, and two mutual funds breached various provisions of the Securities Act.

The Commission found that the respondents failed to maintain proper books and records, acted as an unregistered mutual fund dealer, made misleading statements in their prospectus, engaged in prohibited investments and loans, and breached their statutory duty of care.

Brown was found liable as a director and officer for authorizing and acquiescing in the non-compliance.

A sanctions and costs hearing was scheduled.

Following a merits decision finding the respondents engaged in unregistered trading, advising, illegal distribution, and fraud through a 'Debt Elimination Strategy' program, the Ontario Securities Commission held a sanctions and costs hearing.

The respondents did not attend.

The Commission ordered permanent market bans against the respondents, a $300,000 administrative penalty, disgorgement of $859,555, and costs of $235,502.15, finding their conduct caused significant harm to investors and warranted strong specific and general deterrence.

The Crown appealed a sentence imposed under the Securities Act for unregistered trading, trading without a prospectus, and breaching prohibition orders.

The sentencing judge had imposed an 18‑month sentence to run concurrently with a 27‑month sentence the respondent was already serving for separate securities offences involving a different company.

The Crown argued that the concurrent sentence undermined deterrence and failed to reflect that the offences arose from separate schemes occurring at different times with different victims.

The Superior Court held that the sentencing judge erred by failing to adequately consider the distinct nature of the schemes and the respondent’s repeated breaches of prohibition orders.

The court concluded that the totality principle did not render a 45‑month total sentence disproportionate and ordered the 18‑month term to be served consecutively.

The appellants/applicants sought to appeal and judicially review an interlocutory decision of the Ontario Securities Commission regarding the composition of a panel for a sanctions hearing.

The Divisional Court dismissed the appeal for lack of jurisdiction under s. 9(1) of the Securities Act, which only permits appeals from final decisions.

The application for judicial review was quashed as premature, as the procedural fairness and jurisdictional issues could be raised after the final decision.

Following a merits hearing where the respondent was found to have engaged in unregistered trading, illegal distribution of securities, and making prohibited representations in a boiler room scheme, the Commission held a sanctions and costs hearing.

The respondent did not appear.

The Commission ordered the respondent to cease trading in securities for three years, prohibited him from acquiring securities for three years, reprimanded him, ordered disgorgement of $595 in commissions earned, and permanently banned him from telephoning residences for the purpose of trading securities.

The Ontario Securities Commission held a merits hearing regarding allegations that Empire Consulting Inc. and its principal, Desmond Chambers, breached the Securities Act.

The Respondents operated a 'debt elimination strategy' program, raising approximately $1.5 million from investors for foreign exchange trading.

The Commission found that the Respondents traded and advised in securities without registration, distributed securities without a prospectus, and perpetrated a fraud on investors by misrepresenting portfolio values and misappropriating funds for personal use and to pay other investors.

Chambers, as the directing mind, was found liable for authorizing and acquiescing in the corporate breaches.

The respondent, a former registered securities salesperson, admitted to participating in a boiler room scheme by selling shares of Maitland Capital Ltd. to investors without registration, without a prospectus, and by making prohibited representations.

The Ontario Securities Commission converted the merits hearing into a sanctions hearing based on an agreed statement of facts.

The Commission ordered a three-year trading ban, a permanent telephone solicitation ban, a reprimand, and disgorgement of $91,407.10, representing the commissions the respondent earned from the illegal trades.

Staff of the Ontario Securities Commission alleged that the respondent, Tom Mezinski, traded in securities of Maitland Capital Ltd. without being registered, engaged in an illegal distribution without a prospectus, and made misleading representations to investors regarding the future listing of the shares.

The respondent did not attend the hearing.

The Commission found that the respondent acted as a salesperson in a boiler room operation, selling shares to investors without registration or a prospectus, and made prohibited representations about the shares being listed on a stock exchange.

The Commission concluded that the respondent contravened sections 25(1), 53(1), and 38(3) of the Securities Act, and ordered a separate hearing to determine sanctions and costs.

The defendant pleaded guilty to five offences under the Securities Act, including trading in unregistered securities, distributing securities without a prospectus, and violating multiple Cease Trade Orders issued by the Ontario Securities Commission.

The defendant, acting as a commissioned salesman for an unregistered securities scheme, solicited over $220,000 from investors using an alias and received approximately $44,000 in commissions.

The court sentenced the defendant to 18 months imprisonment, with sentences on the CTO violation counts served consecutively to the trading and distribution counts, but concurrent with an existing 27-month sentence for related offences in the Shallow Oil matter.

Staff of the Ontario Securities Commission sought a reciprocal order under subsection 127(10) of the Securities Act against the respondents based on criminal convictions in Ontario and regulatory orders in Alberta and Saskatchewan.

The Commission found that the pre-conditions for a reciprocal order were met and that subsection 127(10) could be applied to conduct predating its enactment.

The Commission ordered permanent trading bans, director and officer bans, and telephoning bans against the respondents to protect the public interest, but declined to order disgorgement due to insufficient evidence of Ontario investor funds.

The respondents brought a motion challenging the jurisdiction of a newly constituted panel to hear and decide the issues of sanctions and costs, arguing that the panel that heard the merits must also hear the sanctions.

The Commission dismissed the motion, finding that the Secretary has the authority to assign a new panel for the sanctions hearing, which is a separate hearing within the proceeding.

The Commission also found that proceeding before a new panel would not result in procedural unfairness, as the new panel would have access to the merits decision and transcripts, and the sanctions hearing involves forward-looking issues distinct from the retrospective merits hearing.

The respondent brought a motion to revoke or vary a previous decision denying an adjournment of the merits hearing, citing medical reasons.

The respondent was represented by an unlicensed agent (a law student).

The Commission first determined that a law student cannot act as an agent in a contested motion before an administrative tribunal under the Law Society Act and LSUC By-Laws.

On the merits of the adjournment motion, the Commission found no new information to justify varying the original decision under section 144 of the Securities Act.

The motion was dismissed, with the Commission noting the significant delay in the proceedings and prejudice to the unitholders and Staff.