Administrative Law - OCMT

Following a hearing on the merits where findings were made against David Paul Pelcowitz and IMG International Inc., the Ontario Securities Commission held a sanctions and costs hearing.

Staff and Pelcowitz presented a joint submission on sanctions and costs, which the Commission accepted as appropriate and proportionate.

The Commission ordered permanent market bans against Pelcowitz and IMG, an administrative penalty of $300,000 against Pelcowitz, joint and several disgorgement of $605,029.08, and costs of $100,000 against Pelcowitz.

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.

Staff of the Ontario Securities Commission alleged that the respondents engaged in unregistered trading and illegal distribution of securities through the sale of Land Agreements and Solar Panel Agreements.

The respondents argued they were selling tangible goods and real estate, not securities.

The Commission applied the Pacific Coast Coin test and found that both types of agreements constituted investment contracts, as investors provided money with the expectation of profit from a common enterprise managed by the respondents.

The Commission concluded the respondents breached sections 25 and 53 of the Securities Act, but dismissed the allegation of prohibited representations under section 44(2).

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 prior order of the British Columbia Securities Commission.

The BCSC had found that the respondents engaged in unregistered trading and perpetrated a fraud.

The Commission found it was in the public interest to issue a reciprocal order to protect Ontario investors and capital markets, permanently prohibiting the respondents from trading in securities and acting as directors or officers.

Staff of the Ontario Securities Commission sought a reciprocal order under s. 127(10) of the Securities Act based on a final judgment of a U.S. District Court.

The U.S. Court found that the respondents engaged in a Ponzi scheme, securities fraud, and the sale of unregistered securities, raising $1.3 million from investors including Ontario residents.

The Commission found that the respondents' conduct was abusive of the capital markets and would have constituted contraventions of the Ontario Securities Act had it occurred in Ontario.

Applying principles of comity, the Commission granted the reciprocal order, imposing permanent market prohibitions against the respondents to protect the public interest.

Staff of the Ontario Securities Commission sought a reciprocal order under s. 127(10) of the Securities Act based on a decision of the British Columbia Securities Commission (BCSC).

The BCSC had found that the respondents engaged in unregistered trading and illegal distribution of securities, raising $5.7 million from investors without filing a prospectus.

The respondents did not participate in the written hearing.

The Commission found that the respondents' conduct was abusive of the capital markets and that it was in the public interest to reciprocate the BCSC's order.

The Commission permanently prohibited the respondents from trading in securities, acquiring securities, and acting as directors or officers of any issuer or registrant in Ontario.

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.

Enforcement Staff of the Ontario Securities Commission brought a motion to waive service of a Notice of Hearing and Statement of Allegations on the respondents.

The Commission found that Staff had taken all reasonable steps to locate and serve the individual respondent, who was actively avoiding service, and granted the waiver of service against him.

However, the Commission declined to waive service on the corporate respondent because Staff provided no evidence of attempts to serve the corporation or its officers.

Following an agreed statement of facts admitting to unregistered trading and illegal distribution of securities, the Ontario Securities Commission held a sanctions and costs hearing.

The respondents raised approximately $1.5 million from investors who suffered a complete loss.

The Commission ordered 10-year market bans, permanent director and officer bans, a $100,000 administrative penalty, disgorgement of $1.1 million, and $10,000 in costs.

The applicant sought a hearing and review of a Director's decision refusing her application for registration as a dealing representative of a mutual fund dealer.

The Director had found that the applicant lacked the requisite integrity because she failed to disclose her prior employment with a 'boiler room' operation in her registration application and misled Staff during a voluntary interview.

The Commission conducted a hearing de novo and found that the applicant failed to provide complete disclosure of her employment history even when given an opportunity to correct her application.

The Commission concluded that the applicant lacked the requisite integrity for registration and dismissed the application.

Staff of the Ontario Securities Commission sought an inter-jurisdictional enforcement order against the respondents under s. 127(10) of the Securities Act, based on a prior order of the New Brunswick Securities Commission.

The NBSC had found that the respondents engaged in unregistered trading, illegal distribution, and fraud.

The respondents did not appear at the written hearing.

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

The Commission ordered permanent trading and director/officer bans against the first respondent, and 20-year bans against the second respondent, consistent with the NBSC order.

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 settlement agreement and order from the British Columbia Securities Commission.

The respondent had admitted to unregistered trading and cold calling in BC, with aggravating factors including a prior conviction for a Ponzi scheme.

The Commission found it was in the public interest to impose sanctions mirroring the BC order, including a cease trade order and director/officer bans until 2036, subject to a carve-out for one cash and one RSP account.

Staff of the Ontario Securities Commission sought an inter-jurisdictional enforcement order against the respondents under subsection 127(10) of the Securities Act, based on a prior order of the New Brunswick Securities Commission.

The NBSC had found that the respondents engaged in unregistered trading and permanently banned them from trading and using exemptions.

The respondents did not appear at the written hearing.

The Commission found it was in the public interest to protect Ontario investors and capital markets by reciprocating the NBSC order, permanently ceasing the respondents' trading and denying them exemptions under Ontario securities law.

A court-appointed receiver moved to quash a summons issued by the Ontario Securities Commission requiring him to produce documents, including interview notes, for a hearing regarding the respondent's alleged participation in a Ponzi scheme.

The Commission granted the motion to quash, finding that a receiver cannot be compelled to produce documents for a proceeding outside the receivership.

Furthermore, the respondent failed to establish that the requested interview notes were likely relevant to his ability to make full answer and defence.

Following a merits hearing where the respondents were found to have engaged in unregistered trading, illegal distribution, and fraud in connection with the 'Axcess Investments' scheme, the Ontario Securities Commission held a sanctions and costs hearing.

The Commission ordered permanent trading and market prohibitions against Driver, Taylor, and their respective companies, along with significant administrative penalties and disgorgement orders.

Reynold and his company, who were not found to have acted fraudulently but engaged in unregistered trading and illegal distribution, were subject to 15-year market prohibitions, an administrative penalty, and disgorgement.

The respondents were also ordered to pay the costs of the investigation and hearing.

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 finding that the respondent engaged in conduct contrary to the public interest by purchasing shares while in possession of undisclosed material facts, the Ontario Securities Commission held a sanctions and costs hearing.

The Commission declined to impose the 10-year trading bans sought by Staff, finding them excessive given that no technical breach of the Securities Act occurred.

Instead, the Commission ordered a five-year prohibition on the respondent acting as a director or officer of a reporting issuer, issued a reprimand, and ordered the respondent to pay $150,000 in costs.

The respondent admitted to engaging in unregistered trading and illegal distribution of securities by selling shares of Electrolinks Corporation to investors without a prospectus.

The respondent raised over $1.6 million from 89 investors, who suffered a complete loss.

The Ontario Securities Commission ordered permanent market bans, a $150,000 administrative penalty, and disgorgement of $486,000, finding the respondent's conduct to be predatory and a serious breach of Ontario securities law.

Staff of the Ontario Securities Commission brought allegations against the respondents.

The corporate respondent, located in Mexico and unrepresented, requested that copies of all relevant disclosure documents be sent to its offices.

Staff refused, citing confidentiality concerns regarding compelled evidence under section 16 of the Securities Act, and instead offered inspection at the Commission's offices.

The Commission held that Staff failed to meet their disclosure obligations.

Meaningful disclosure required providing copies to the foreign respondent to allow it to make full answer and defence, subject to the respondent providing a written undertaking to maintain confidentiality.

Following a merits hearing where the respondents were found to have breached Ontario securities law by failing to maintain an audit committee, failing to file audited financial statements, and obstructing an investigation, the Commission held a sanctions and costs hearing.

The respondents did not appear.

The Commission ordered permanent cease trade orders against the corporate and individual respondents, permanent director and officer bans against the individual respondents, and ordered the individual respondents to pay $63,667.50 in costs on a joint and several basis.