Michelle Vaillancourt

Oscar Furtado brought a motion to adjourn the merits hearing on medical and disclosure grounds, to compel further disclosure from Staff, and to keep parts of the hearing and record confidential.

The Tribunal dismissed the adjournment request, finding the medical evidence insufficient to establish exceptional circumstances and no delay in disclosure warranting an adjournment.

The Tribunal also dismissed the disclosure request, finding Staff met its obligations.

The Tribunal granted the confidentiality request in part, ordering redactions of specific medical details and certain exhibits to balance the open court principle with Furtado's privacy interests.

The respondent, a mutual fund dealing representative, managed the investments of an elderly, vulnerable client who was diagnosed with terminal cancer.

Shortly before her death, the client executed a will and powers of attorney naming the respondent as her power of attorney for property and personal care, alternate executor, and sole beneficiary of her estate.

The respondent failed to report these appointments and the testamentary gift to his dealer firm, contrary to MFDA Rules and the firm's policies and procedures regarding conflicts of interest.

The Capital Markets Tribunal found that the respondent breached MFDA Rules and his firm's policies, and that his failure to address these conflicts of interest constituted a breach of his statutory obligation under OSC Rule 31-505 to deal with his client fairly, honestly, and in good faith.

The appellants appealed the Ontario Securities Commission's findings that they engaged in fraudulent conduct in connection with three distributions of securities and the resulting sanctions.

The Divisional Court applied the appellate standard of review from Vavilov, finding no palpable and overriding errors of fact, no errors of mixed fact and law, and no denial of procedural fairness.

The Commission's reasons were adequate and the sanctions, including permanent bans, administrative penalties, and disgorgement orders, were reasonable and supported by the evidence.

The appeal was dismissed.

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 alleged that the respondent dealers failed to establish sufficient controls and supervision, resulting in clients paying excess fees.

The dealers self-reported the inadequacies, co-operated with Staff, and agreed to pay approximately $11 million in compensation to affected clients, along with voluntary payments totalling $490,000.

The Commission approved the no-contest settlement, finding it in the public interest given the prompt self-reporting, remediation efforts, and significant compensation paid to clients.

The Ontario Securities Commission approved a settlement agreement with the respondent regarding its failure to comply with mutual fund sales practices under NI 81-105.

Over a five-year period, the respondent engaged in excessive promotional spending and provided excessive non-monetary benefits to dealing representatives.

The respondent also failed to maintain adequate controls, supervision, and records.

The settlement included an $800,000 administrative penalty, $150,000 in costs, a reprimand, and a requirement to submit to a review by an independent consultant.

The Ontario Securities Commission approved a settlement agreement with Mackenzie Financial Corporation regarding its failure to comply with mutual fund sales practices under National Instrument 81-105.

Between 2014 and 2017, Mackenzie provided excessive non-monetary benefits to dealing representatives, including expensive golf events, sports tickets, and iPads, and failed to maintain adequate systems of control and supervision.

Mackenzie admitted to the breaches, cooperated with the investigation, and agreed to a reprimand, an independent consultant review, a $900,000 administrative penalty, and $150,000 in costs.

Following the dismissal of the appellants' appeal from an Ontario Securities Commission decision finding them guilty of securities fraud, the Commission and the intervenors sought costs.

The Commission sought $40,000, which the court awarded in full on a partial indemnity basis.

The intervenors, who were the appellants' former counsel and intervened to defend against allegations of ineffective assistance, sought over $53,000 on a substantial indemnity basis.

The court held that the intervenors were entitled to costs as parties to the appeal, but reduced the scale to partial indemnity and fixed their costs at $20,000.

Following findings that the respondents engaged in three separate frauds involving the sale of shares at an inflated value, undisclosed use of investor funds to pay dividends, and misappropriation of funds, the Ontario Securities Commission held a sanctions and costs hearing.

The Commission ordered the individual respondents to disgorge over $3.3 million obtained through their fraudulent conduct.

In addition, the Commission imposed administrative penalties of $600,000 each on the individual respondents and $300,000 on the corporate respondent, ordered permanent market prohibitions, and awarded $550,000 in costs.

The appellants appealed the Ontario Securities Commission's decisions finding them liable for securities fraud and imposing severe sanctions, including lifetime trading bans, disgorgement, and administrative penalties.

The appellants argued that the presiding commissioner was biased, that their counsel at the hearing was incompetent and in a conflict of interest, and that the findings of fraud and the penalties were unreasonable.

The Divisional Court dismissed the appeal, finding no reasonable apprehension of bias, rejecting the fresh evidence regarding counsel's competence as it would not have affected the outcome, and concluding that the Commission's findings on fraud and sanctions were reasonable and supported by the evidence.

The Ontario Securities Commission approved a no-contest settlement agreement between Staff and the Assante Dealers regarding excessive management expense ratios charged to clients.

The Assante Dealers self-reported the issue, cooperated with Staff, implemented a remediation program, and paid $3.6 million in compensation to affected clients, along with voluntary payments to the Commission.

The panel found the settlement to be fair, reasonable, and in the public interest.

The applicants sought a review of a decision by a Director of the Ontario Securities Commission refusing to amend the individual applicant's registration to designate her as the ultimate designated person (UDP) for the applicant firms.

The Director had found the proposed amendment 'otherwise objectionable' under s. 27(1) of the Securities Act.

The Commission found that the individual applicant's father, who had been permanently suspended as UDP and prohibited from acting as an officer or director of any registrant due to prior non-compliance, continued to act as an officer of the firms by directing sales and recruiting.

The Commission held that the individual applicant, as chair of the boards, failed to take meaningful steps to ensure compliance with the prior order restricting her father's involvement.

Given the firms' history of non-compliance and the critical role of a UDP in promoting a culture of compliance, the Commission concluded that the proposed registration was objectionable and dismissed the application.

Staff of the Ontario Securities Commission alleged that the Manulife Dealers failed to establish adequate controls and supervision, resulting in clients paying excess fees on certain investment products and mutual funds.

The Manulife Dealers self-reported the inadequacies, cooperated with Staff, and entered into a no-contest settlement agreement.

The Commission approved the settlement, finding it in the public interest given the dealers' prompt self-reporting, extensive cooperation, voluntary payments of $495,000 and $25,000 for costs, and an $11.7 million compensation plan for affected clients.

Staff of the Ontario Securities Commission alleged that the RBC Registrants failed to establish sufficient controls and supervision, resulting in certain clients paying excess fees.

The RBC Registrants promptly self-reported the inadequacies, cooperated with Staff, and entered into a no-contest settlement agreement.

Under the settlement, the RBC Registrants agreed to pay over $21 million in compensation to affected clients, make a voluntary payment of $925,000 to the Commission, and pay $50,000 for costs.

The Commission approved the settlement, finding it to be in the public interest given the prompt self-reporting, cooperation, and comprehensive corrective actions taken by the registrants.

The moving parties, who were respondents in a 2014 enforcement proceeding, brought a motion seeking directions regarding a 2014 Commission order and an order requiring the Director to approve a registration application for a new Ultimate Designated Person.

Staff of the Commission opposed the motion on jurisdictional grounds.

The Commission dismissed the motion, holding that it is functus officio and lacks jurisdiction to give directions or grant relief after a proceeding has ended, absent a slip or error or specific statutory authority.

The Commission further held that it lacks jurisdiction to bypass the statutory process and order the Director to approve a registration application.

The Ontario Securities Commission approved a settlement agreement with Sentry Investments Inc. and Sean Driscoll regarding failures to comply with National Instrument 81-105 – Mutual Fund Sales Practices.

The respondents admitted to sales practices involving prohibited payments and gifts to registered dealers, as well as systemic supervisory failures.

The settlement included a significant administrative fine for Sentry, a $100,000 reparation payment by Driscoll, and a ban on Driscoll acting as a director or officer of a registrant until completing regulatory compliance courses.

The Commission found the agreed sanctions were within a reasonable range of appropriateness and in the public interest.

Waverley Corporate Financial Services Ltd. and its Chief Compliance Officer, Donald McDonald, applied for a hearing and review of a Director's decision imposing terms and conditions on their registrations.

Staff alleged that Waverley's business model, which involved sponsoring dealing representatives who were closely connected to independent issuers, breached Ontario securities law.

The Commission found that while the representatives did not act exclusively for the issuers, Waverley failed to adequately identify, manage, and disclose material conflicts of interest.

Furthermore, Waverley's systems of control and supervision were inadequate, and McDonald lacked the necessary proficiency to act as CCO.

The Commission imposed strict terms and conditions on their registrations to address these deficiencies.

Staff of the Ontario Securities Commission and the CIBC Dealers entered into a settlement agreement regarding inadequacies in the dealers' systems of controls and supervision.

These inadequacies resulted in certain clients paying excess fees on mutual funds, structured notes, exchange-traded funds, and closed-end funds held in fee-based accounts.

The CIBC Dealers self-reported the issues, cooperated with Staff, and agreed to a compensation plan estimated at $73,260,104 for affected clients, along with voluntary payments of $3,000,000 to the Commission and $50,000 for costs.

The Commission approved the settlement agreement, finding it to be in the public interest.

The CIBC Dealers self-reported inadequacies in their systems of controls and supervision that resulted in certain clients paying excess fees.

Staff of the Ontario Securities Commission and the CIBC Dealers entered into a Settlement Agreement.

The Commission approved the Settlement Agreement, noting the CIBC Dealers' prompt self-reporting, cooperation, implementation of a compensation plan estimated at $73.2 million for affected clients, and voluntary payments of $3 million to the Commission and $50,000 for costs.

Staff of the Ontario Securities Commission alleged that the Scotia Dealers failed to establish, maintain, and apply appropriate controls and procedures with respect to supervision, resulting in certain clients paying excess fees.

The Scotia Dealers self-reported the inadequacies, cooperated with Staff, and entered into a no-contest settlement agreement.

The Commission approved the settlement agreement, noting the Scotia Dealers' commitment to pay compensation to affected clients, enhance policies and procedures, and make voluntary payments of $800,000 for investor education and $50,000 for costs.

The Commission found the settlement to be in the public interest.