Securities Law - ONCJ

This is a sentencing decision for Chandramattie Dave and Ravindra Dave, who pleaded guilty to trading in securities while prohibited by an Ontario Securities Commission (OSC) order, contrary to s. 122(1)(c) of the Securities Act.

Both defendants were subject to market bans.

The OSC sought a fine and probation, while the defendants sought a suspended sentence and probation.

The court considered the defendants' impecunious state, poor health, diminished moral blameworthiness due to reliance on incorrect legal advice, lack of investor loss, and guilty pleas.

Applying regulatory sentencing principles, the court imposed a suspended sentence with two years probation for each defendant, including the forfeiture of $2,250 to the OSC, but declined to impose a fine due to the defendants' inability to pay.

Douglas DeBoer pleaded guilty to two counts of fraud and one count of trading in securities while subject to a cease trade order under the Securities Act.

The court considered the circumstances of the offence, which involved two fraudulent investment schemes (Hockley Energy and Rocky Point) that defrauded investors of $7.5 million USD, and the offender's personal circumstances.

Emphasizing general deterrence as paramount in regulatory offences, the court found a high degree of moral blameworthiness due to the sophisticated, persistent nature of the fraud and the significant harm to investors.

Despite a guilty plea and no prior criminal record, the court imposed a total sentence of three years' incarceration, noting the central role of the offender and the breach of a prior cease trade order.

This judgment addresses three charges against Mr. Singh under the Ontario Securities Act (OSA) for unregistered trading, distribution without a prospectus, and fraud, as well as two Charter applications.

The court first dismissed Mr. Singh's application for a stay of proceedings based on unreasonable delay under s. 11(b) of the Charter, finding the net delay constitutionally tolerable after accounting for defence-caused delay and the COVID-19 pandemic as a discrete exceptional event.

It also dismissed his s. 7 Charter application, which alleged his right to make full answer and defence was violated by the virtual nature of the trial, concluding he was able to participate effectively.

Subsequently, the court found Mr. Singh guilty beyond a reasonable doubt on all three OSA charges, determining he was the operating mind of Rockfort and Greenview, engaged in unregistered trading and distribution of securities, and committed fraud by misrepresenting the companies as mortgage investment corporations that held no mortgages and by making other material misrepresentations to investors.

Accused charged with trading in securities without registration, issuing securities without filing prospectus, and representing that securities would be listed on exchange with intention of effecting trade.

Accused developed website for company (Asia Global/Asia Power) which stated company would be listed on exchange in future.

Website made clear company was not currently listed and no shares available for purchase.

Unregistered sales representatives defrauded private investors by selling non-existent shares.

Evidence did not establish connection between accused and sales representatives or investors, or that website was created to induce share purchases.

Creation of website not constituting act in furtherance of trade.

Accused not trading in or issuing security and not making representation with intention of effecting trade.

All charges dismissed.

The accused pleaded guilty to two counts of violating section 122(1)(c) of the Ontario Securities Act.

The first violation involved entering into a joint venture agreement that qualified as an investment contract and security without being registered to trade in securities.

The second violation involved breaching a Cease Trade Order by entering into promissory note agreements while prohibited from trading in securities.

The accused, a former police officer, had promoted U.S. real estate properties to Canadian investors, making representations about turn-key investments and property management.

Many properties were in poor condition and promises were not fulfilled.

The court imposed fines, probation, community service, and restitution orders rather than a custodial sentence, finding the conduct closer to carelessness than deliberate fraud.

The defendants were charged with three breaches of the Securities Act: trading in securities without registration, trading without filing a prospectus, and trading while prohibited by a cease trade order.

The sole issue was whether fourteen promissory notes totaling $700,000 issued to investment clients constituted securities under the Act.

The defendants admitted the factual elements but argued the notes were private loan agreements exempt from securities regulation.

The court applied the "Family Resemblance Test" from Reves v. Ernst & Young and found the notes were not securities, as they resembled notes secured by a lien on a small business's assets—a recognized category of non-security notes.

The charges were dismissed.

The accused pleaded guilty to engaging in securities trading without being registered in violation of the Ontario Securities Act.

She was a hospital file clerk who provided names of new mothers to an investment company representative in exchange for payment, facilitating high-pressure sales tactics targeting vulnerable new parents.

The court imposed a $36,000 fine (plus 25% surcharge totalling $45,000), two years probation, and 300 hours community service, rejecting both the Crown's request for 90 days jail and the defence's request for a $20,000 fine.

The sentence balanced general deterrence principles with the accused's mitigating factors including remorse, guilty plea, no prior record, and rehabilitative efforts.

The Crown appealed a sentencing decision imposing a $10,000 fine on a defendant convicted of dealing in mortgages without a licence under the Mortgage Brokerages, Lenders and Administrators Act, 2006.

The defendant, a former licensed mortgage broker whose licence had been revoked, continued to conduct mortgage brokering activities through a separate company while unlicensed, generating $48,967.20 in commissions over 14 transactions.

The Crown sought a fine of $100,000 at trial and $75,000 on appeal, arguing the sentence failed to give appropriate weight to general deterrence.

The appellate court dismissed the Crown's appeal, finding the trial judge properly considered deterrence and other relevant sentencing principles, and that the $10,000 fine was fit and appropriate given the circumstances of the offender and the nature of the strict liability offence.

The defendant pleaded guilty to three offences under section 122 of the Securities Act for trading in securities without registration and in violation of two cease trading orders from the Ontario Securities Commission.

The defendant operated Strategic Gifting Group, which solicited donations for charities, remitted 10% to the charities, and distributed shares in Dixon Perot & Champion Inc. to donors, representing inflated valuations.

The defendant had previously been sentenced to 21 months and 3 years for related securities violations.

The court imposed a sentence of 6 months consecutive to existing sentences, along with probation and restitution obligations, applying the totality principle to avoid a crushing cumulative sentence while maintaining deterrence and denunciation.

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.