An order that is made regarding a licence holder reflects a situation at a particular point in time. The status of a licence holder can change.

Transcription

1 An order that is made regarding a licence holder reflects a situation at a particular point in time. The status of a licence holder can change. Readers should check the current status of a person s or entity s licence on the Licensing Link section of FSCO s website. Readers may also wish to contact the person or entity directly to get additional information or clarification about the events that resulted in the order.

2 Superintendent of Financial Services W Ontario surintendant des services financiers REGARDING the Mortgage Brokerages, Lenders and Administrators Act, 2006, S.O. 2006, c.29 (the "Act"), in particular sections 9, 14, 19, and 21 AND REGARDING Terry A. McGill and 1. A. McGill Mortgage Services Inc. INTERIM ORDER TO SUSPEND LICENCES AND NOTICE OF PROPOSAL TO REVOKE LICENCES Terry A. McGill ("McGill") was issued a mortgage broker licence under the Act effective July 1, 2008, and 1. A. McGill Mortgage Services Inc. ("corporation") was issued a mortgage brokerage licence under the Act effective July 1, INTERIM ORDER TO SUSPEND LICENCES Section 19(1) of the Act provides that the Superintendent of Financial Services ("Superintendent") may, in appropriate circumstances, revoke a mortgage broker licence and mortgage brokerage licence. Section 21 of the Act provides that where the Superintendent proposes to revoke a licence, the Superintendent shall give written notice of the proposal to the licencee, including reasons for the proposal. A notice of proposal to revoke the mortgage broker licence of McGill and the mortgage brokerage licence of the corporation is set out below. Section 19(3) of the Act provides that if in the Superintendent's opinion the interests of the public may be adversely affected by any delay in the revocation of a licence as result of the steps required by section 21, the Superintendent may, without notice, make an interim order suspending the licence and may do so before or after giving the notice required by section 21. In the Superintendent's opinion, the interests of the public may be adversely affected by any delay in the revocation of the licences of McGill and the corporation for the following reasons: Si vous desirez recevoir cet avis en francais, veuillez addresser votre demande dans un delai de 15 jours Ii: Adjointe, audiences, Greffe, Commission des services financiers de l'ontario, 5160 rue Yonge, boite 85, Toronto ON M2N

3 2 1. McGill holds a current mortgage broker licence and is the president and secretary of the corporation, which currently holds a mortgage brokerage licence. McGill is the principal broker of the corporation. 2. Between approximately September, 2004 and October, 2009, McGill, along with JPB, promoted investment in "ForexBaron," described to investors as a business venture involving investment in foreign currency that would provide a guaranteed rate of return of 28%,56% or 84%, depending on the investor. 3. McGill recommended the ForexBaron investment to clients, some of whom knew and trusted him because he had acted as a mortgage broker for them on previous occasions. 4. In some cases investors were advised by McGill to obtain funds to invest by mortgaging their property, including their residential homes. McGill told them that given its high rate of return, the ForexBaron investment would fully cover the mortgage payments. 5. McGill often brokered the mortgage which provided the investment funds and received fees and/or commissions for doing so. 6. McGill and JPB convinced 3 corporations and 25 individuals to invest sums ranging from $25,000 to $550,000 in the scheme, for a total investment of approximately $2.17 million. 7. Initially, after the funds were invested, investors received some interest payments which stopped after a matter of months. Ultimately the investors lost their investments. 8. An investigation conducted by the RCMP showed that the investment funds were not used for any legitimate investment in ForexBaron. Rather, they were used to make interest payments to other investors and for personal expenses. 9. The RCMP investigation culminated in 31 charges of fraud over $5,000 being laid against McGill, JPB and an employee of the corporation. Those charges are before the courts. 10. Based on information currently available, it appears that McGill, together with JPB, promoted and facilitated a scheme to defraud investors. 11. In these circumstances, it appears that McGill's conduct in relation to the ForexBaron scheme affords reasonable grounds for belief that McGill will not deal or trade in mortgages in accordance with the law and with integrity and honesty and his role in the ForexBaron scheme has resulted in serious loss to many individuals. Si vous desirez recevoir cet avis en francais, veuillez addresser votre demande dans un delai de 15 jours a: Adjointe, audiences, Greffe, Commission des services financiers de l'ontario, 5160 rue Yonge, boite 85, Toronto ON M2N

4 3 12. Accordingly, the Superintendent is of the opinion that the public is at risk and a delay in the revocation in the licences of McGill and the corporation which he controls may adversely affect the public interest. ORDER It is ordered that the mortgage broker licence of Terry A. McGill be immediately suspended, pursuant to section 19(3) of the Act. It is ordered that the mortgage brokerage licence of T.A. McGill Mortgage Services Inc. be immediately suspended, pursuant to section 19(3) of the Act. During the suspension Terry A. McGill and T. A. McGill Mortgage Services Inc. are not authorized to carry on the business of dealing in mortgages in Ontario or in the business of trading on mortgages in Ontario, to deal in mortgages in Ontario or trade in mortgages in Ontario. Pursuant to s. 17(3)(b) of the act, the licences of all mortgage brokers and agents authorized by T. A. McGill Mortgage Services Inc. to deal in mortgages or trade in mortgages on its behalf are also suspended. The Interim Order takes effect immediately and will remain in effect until the expiry of the period for requesting a hearing about the Superintendent's Notice of Proposal to Revoke Licence. If Terry A. McGill and T. A. McGill Mortgage Services Inc. request a hearing before the Financial Services Tribunal, the Superintendent may extend the interim order until the proposal is finally determined. Pursuant to sections 48(4) and 49(1) of the Act, every person who fails to comply with an order made under this Act is guilty of an offence and every individual convicted of an offence under the Act is liable to a fine of not more than $100,000 or imprisonment for a term of not more than a year or both a fine and imprisonment. NOTICE OF PROPOSAL TO REVOKE LICENCE TAKE NOTICE THAT pursuant to section 21 of the Act, the Superintendent is proposing to revoke the licences of Terry A. McGill and T. A. McGill Mortgage Services Inc. The Superintendent believes that Terry A. McGill is no longer suitable to be licenced as a mortgage broker because his past conduct affords reasonable grounds for belief that he will not deal or trade in mortgages in accordance with the law and with integrity and honesty. The reasons for the proposal to revoke the licence will be served Si vous desirezrecevoircet avis en francais, veuillez addresser votre demande dans un delai de 15jours a; Adjointe, audiences. Greffe,Commission des services fmanciers de l'ontario, 5160rue Yonge, boite 85. Toronto ON M2N

5 4 with this Notice. The Superintendent also believes that T. A. McGill Mortgage Services Inc. is no longer suitable to be licenced as a mortgage brokerage because the past conduct of Terry A. McGill, the corporation's president and secretary, affords reasonable grounds for belief that the business of the brokerage will not be carried on in accordance with the law and with integrity and honesty. The reasons for the proposal to revoke both licences will be served with this Notice. AND TAKE NOTICE THAT section 21(3) of the Act provides that Terry A. McGill and T. A. McGill Mortgage Services Inc may request a hearing before the Financial Services Tribunal in respect of this Notice within 15 days after this Notice is received, or deemed to have been received. The request for a hearing shall be in writing (Form 1, Request for Hearing, sent along with this Notice) and shall be mailed or delivered: TO: Financial Services Tribunal 5160 Yonge Street, Box 85 Toronto,ON M2N Attention: Registrar Fax: AND TO: Superintendent of Financial Services Senior Manager, Licensing Licensing and Marketing Conduct Division 5160 Yonge Street, Box 85 Toronto ON M2N If a hearing is not requested or no request is made in accordance with section 21(3), section 21 (7) of the Act provides that the Superintendent may carry out the proposal to revoke the licences. If a hearing is requested, section 21(4) of the Act provides that the Tribunal may, by order, direct the Superintendent to carry out the proposal, with or without changes, or substitute its opinion for that of the Superintendent and the Tribunal may impose such conditions as it considers appropriate in the circumstances. At the hearing, the good character, propriety of conduct or competence of Terrance A. McGill will be in issue. The hearing before the Tribunal will proceed in accordance with the Rules of Practice and Procedure of the Financial Services Tribunal made under the authority of the Si vous desirez recevoir cet avis en francais, veuillez addresser votre demande dans un delai de 15 jours Ii: Adjointe, audiences, Greffe, Commission des services financiers de l'ontario, 5160 rue Yonge, boite 85, Toronto ON M2N

6 5 Statutory Powers Procedure Act, R.S.O. 1990, c. S. 22. The Rules of Practice and Procedure are available at the website of the Tribunal: Alternatively, a copy can be obtained by telephoning the Registrar of the Financial Services Tribunal at , or toll free at ext DATED at Toronto, Ontario,,2010. Philip H ell Superintendent of Financial Services Sivous desirez recevoir cetavis enfrancais, veuillez addresser votre demande dans un delai de 15 jours a; Adjointe, audiences, Greffe, Commission des services financiers de I'Ontario, 5160 rue Yonge, boite 85, Toronto ON M2N