Enforcement order

IN THE MATTER OF the Mortgage Brokerages, Lenders and Administrators Act, 2006, S.O. 2006, c.29, as amended (the “Act”), in particular sections 2, 35, 38, 39, and 43;

AND IN THE MATTER OF Jeshuren Anandarajah, Romola Anandarajah, Noah’s Ark Community Centre, and NACC Legal Services;

NOTICE OF PROPOSAL TO ISSUE COMPLIANCE ORDER

and

NOTICE OF PROPOSAL TO IMPOSE ADMISTRATIVE PENALTIES

TO: Jeshuren Anandarajah

AND TO: Romola Anandarajah

AND TO:
Noah’s Ark Community Centre
2250 Bovaird Dr East, Unit 514 Brampton, ON L6R 0W3

AND TO:
NACC Legal Services
2250 Bovaird Dr East, Unit 514 Brampton, ON L6R 0W3

TAKE NOTICE THAT pursuant to sections 2 and 35 of the Act, and by delegated authority from the Chief Executive Officer of the Financial Services Regulatory Authority of Ontario (the “Chief Executive Officer”), the Director, Litigation & Enforcement (the “Director”) is proposing to issue a permanent order against Jeshuren Anandarajah, Romola Anandarajah, Noah’s Ark Community Centre, and NACC Legal Services to cease dealing in mortgages without being licensed under the Act. The reasons for this proposal are described below.

AND

TAKE NOTICE THAT pursuant to section 39 of the Act, and by delegated authority from the Chief Executive Officer, the Director is proposing to impose five administrative penalties in the total amount of $50,000 on Jeshuren Anandarajah as follows:

$10,000 each for two instances of contravening subsection 43(2) of the Act by providing false or deceptive information when dealing in mortgages;

$10,000 for contravening subsection 3.1 of O. Reg. 187/08 by acting or omitting to act in circumstances where Jeshuren Anandarajah ought to have known that such actions or omissions to act would facilitate dishonesty, fraud, crime, or illegal conduct; and

$10,000 each for two instances of contravening subsection 4(1) of O. Reg. 187/08 by receiving remuneration for dealing or trading in mortgages from a person other than the brokerage on whose behalf Jeshuren Anandarajah was authorized to deal or trade in mortgages.

Details of these alleged contraventions and reasons for this proposal are described below. This Notice of Proposal includes allegations that may be considered at a hearing. The allegations contained in this Notice of Proposal are unproven until the Financial Services Tribunal has determined their validity or, if no hearing is requested, the Chief Executive Officer has issued an order.

SI VOUS DÉSIREZ RECEVOIR CET AVIS EN FRANÇAIS, veuillez nous envoyer votre demande par courriel immédiatement à: contactcentre@fsrao.ca.

YOU ARE ENTITLED TO A HEARING BY THE FINANCIAL SERVICES TRIBUNAL (THE“TRIBUNAL”) PURSUANT TO SECTION 35(4) OF THE ACT. A hearing by the Tribunal about this Notice of Proposal may be requested by completing the enclosed Request for Hearing Form (Form 1) and delivering it to the Tribunal within fifteen (15) days after this Notice of Proposal is received by you. The Request for Hearing Form (Form 1) must be mailed, delivered, faxed or emailed to:

Address:
Financial Services Tribunal
25 Sheppard Avenue West, 7th floor Toronto, ON M2N 6S6

Attention: Registrar

Fax: 416-226-7750

Email: contact@fstontario.ca

TAKE NOTICE THAT if you do not deliver a written request for a hearing to the Tribunal within fifteen (15) days after this Notice of Proposal is received by you, orders will be issued as described in this Notice of Proposal.

For additional copies of the Request for Hearing Form (Form 1), visit the Tribunal’s website at www.fstontario.ca

The hearing before the Tribunal will proceed in accordance with the Rules of Practice and Procedure for Proceedings before the Financial Services Tribunal (“Rules”) made under the authority of the Statutory Powers Procedure Act, R.S.O. 1990, c. S.22, as amended. The Rules are available at the website of the Tribunal: www.fstontario.ca. Alternatively, a copy can be obtained by telephoning the Registrar of the Tribunal at 416-590-7294, or toll free at 1-800- 668-0128 extension 7294.

At a hearing, your character, conduct and/or competence may be in issue. You may be furnished with further and or other particulars, including further or other grounds, to support this proposal.

REASONS FOR PROPOSAL

I. INTRODUCTION

These are reasons for the proposal by the Director to:
1. Make a permanent order against Jeshuren Anandarajah, also known as Jessy Anandarajah (“Jeshuren”), to cease dealing in mortgages without being licensed under the Act;
2. Make a permanent order against Romola Anandarajah, also known as Ramona Anandarajah, Ronona Anandarajah, Mona Anandarajah, Meera Anandarajah, Mira Anandarajah, Mona Anand, and Jenny Anandarajah (“Romola”), to cease dealing in mortgages without being licensed under the Act;
3. Make a permanent order against Noah’s Ark Community Centre, also known as Noah’s Ark Community Center (“NACC”), to cease dealing in mortgages without being licensed under the Act;
4. Make a permanent order against NACC Legal Services (“NACCLS”) to cease dealing in mortgages without being licensed under the Act; and
5. Impose five administrative penalties in the total amount of $50,000 on Jeshuren.

II. BACKGROUND

A. Parties

Jeshuren was previously licensed as a mortgage agent (licence #M15001775) under the Act. He was licensed from August 24, 2015, until his license expired on March 31, 2020.

As a mortgage agent, Jeshuren was licensed through various brokerages:
1. From August 24, 2015 to September 30, 2015 (at which time he was terminated), Jeshuren was licensed through AKAL Mortgages Inc.;
2. Pursuant to paragraph 17(3)(a) of the Act, Jeshuren’s license was suspended from October 1, 2015 to October 11, 2017;
3. From October 12, 2017, to March 31, 2018 (at which time he was terminated), Jeshuren was licensed through Centum Future Mortgage Group Inc.;
4. Pursuant to paragraph 17(3)(a) of the Act, Jeshuren’s license was suspended from April 1, 2018, to March 26, 2019;
5. From March 27, 2019, to September 3, 2019 (at which time he was terminated), Jeshuren was licensed through Valor Financial Corp. (“Valor”); and
6. Pursuant to paragraph 17(3)(a) of the Act, Jeshuren’s license was suspended from September 4, 2019, until it expired on March 31, 2020.

Romola is Jeshuren’s mother. Romola is not and never has been licensed under the Act.

NACC is unincorporated and unregistered. NACC is not and never has been licensed under the Act.

As of February 18, 2018, NACC’s website advertised “LOANS AT NACC”, stated that it “refers [its] clients to private lenders and institutions”, and claimed that it “specialized” in loans for “Residential Properties/Lands, Commercial and Industrial Properties/Lands, Construction Finance, Investment Properties/Apartment Buildings, Gas Stations, Plazas, Medical Buildings, Stores with Apartments, [and] Retail Commercial.”

Jeshuren was listed as President of NACC on its website. He is listed in the Ontario corporate registry as the Director of the associated entity, “NACC World Wide Consulting.”

“Ronana Meera Anandarajah” was listed on a NACC business card as “Coordinator.” Romola signed the lease for NACC’s office. Romola used the email address “noahsarkcommunitycenter@hotmail.com”.

NACCLS is registered under the Business Names Act, R.S.O. 1990, c. B.17, as a sole proprietorship. Jeshuren is the sole proprietor of NACCLS.

NACCLS is not and never has been licensed under the Act.

NACC and NACCLS share the same address.

B. Unlicensed Dealing in Mortgages with Respect to “JH”

“JH” is an Ontario resident and previously owned a property in Brampton (the “JH Property”). Romola dealt in mortgages with respect to JH, both individually and via NACC.

In or about 2017, JH sought mortgage financing in respect of the JH Property. JH was referred to Romola.

JH met with Romola and Jeshuren several times at the NACC office in August and September of 2017. Romola told JH that she and Jeshuren were both mortgage brokers and could arrange mortgage financing of $200,000 with respect to the JH Property.

At Romola’s request, JH supplied Romola with a copy of her utility bill, property taxes, passport, and other documents. Also at Romola’s request, JH gave Romola six post- dated cheques intended to make payments in respect of the mortgage financing.

Romola then contacted “SQ,” a mortgage broker. Romola told SQ that she represented JH as a borrower and was seeking a mortgage lender.

On August 17, 2017, Romola used a NACC email address to send an appraisal of the JH Property to SQ.

On September 12, 2017, the lender’s lawyer emailed Romola at a NACC email address and attached a Mortgage Commitment for $300,000 in respect of the JH Property and an Irrevocable Direction for a “mortgage fee” of $45,000.

On September 19, 2017, a mortgage of $300,000 was placed on the JH Property.

Subsequently in September of 2017, Romola told JH to come to the NACC offices to sign documents with respect to the mortgage. However, when JH arrived at the NACC offices, Romola instead provided JH with a cheque for $53,240 that Romola claimed represented the proceeds from the mortgage.

JH expressed surprise as she did not understand how the mortgage had closed. Romola told JH not to worry but refused to provide JH with copies of the mortgage documents.

Subsequent to the meeting at the NACC office, JH repeatedly contacted Romola and asked for copies of the mortgage documents. Romola repeatedly told JH that she would send the documents, but failed to do so.

JH had previously provided Romola with a series of post-dated cheques with respect to the mortgage. Romola subsequently told JH that the mortgage had been prepaid for six months, and these cheques would not be cashed. However, when JH attended her bank in December of 2017, she learned that some of these post-dated cheques had been cashed.

JH attempted to contact Romola via telephone and instant messages, but Romola did not respond.

On January 17, 2018, JH was served with a document titled “Form 1-Notice of Sale under Mortgage” demanding repayment of $318,695 in respect of the mortgage arranged by Romola.

The JH Property was sold. Of the proceeds from the sale of the JH Property, JH received only $53,240.

C. Dealing in Mortgages with Respect to “DT”

“DT” is an Ontario resident and a designer and developer of residential properties. Romola and Jeshuren dealt in mortgages with respect to two residential projects that DT was developing.

(i) The Wellington Project

Through a numbered company, DT owned a property on Wellington Street in Toronto (the “Wellington Property”). In late 2018, DT was developing a residential project on the Wellington Property (the “Wellington Project”). However, DT had exhausted the funds borrowed from a first lender (the “First Lender”) and required additional funds to complete the Wellington Project.

In late 2018, DT was referred to Jeshuren and Romola, who he was told had access to a family fund of capital. Over the next year, Jeshuren and Romola provided DT with a series of false or deceptive mortgage commitments, and successfully arranged one mortgage.

Jeshuren met with DT and stated that he and Romola could obtain financing in respect of the Wellington Property. In or around January 2019, Jeshuren and Romola provided DT with a $6,500,000 mortgage commitment from Venna 121 Canada Inc. (“Venna”), which they stated was their family company (the “Venna Commitment”).

Jeshuren is a director of Venna.

The address on the Venna Commitment was “2250 Bovaird Drive East, Brampton, Ontario,” which is the address for NACC. The Venna Commitment stated that the interest rate would be 9.99%, and fees would be charged of 5.5% (i.e. $577,500).

Jeshuren and Romola told DT that prior to a mortgage being issued, DT was required to obtain an appraisal of the Wellington Property. DT provided $10,000 to Jeshuren and Romola to obtain this appraisal.

Several weeks passed, during which Jeshuren and Romola told DT not to worry and that Venna would provide mortgage financing.

However, the Venna Commitment failed to result in financing. Jeshuren and Romola then told DT that they could obtain a lower interest rate from other lenders.

Due to the delay in obtaining financing, DT was required to enter into an agreement with the First Lender whereby the Wellington Project went into receivership, but the First Lender temporarily held off on selling the Wellington Property until DT could obtain new financing.

In April of 2019, Jeshuren and Romola provided DT with a mortgage commitment from The Bond Group Inc. (“The Bond Group”) for $4,500,000 (the “Bond Commitment”). Jeshuren and Romola stated that The Bond Group was a lender with whom they worked.

A principal of The Bond Group states Romola and DT met with him seeking financing, but further states that The Bond Group did not issue the Bond Commitment.

The address on the Bond Commitment was “2250 Bovaird Drive East, Brampton, Ontario,” which is the same address used by NACC and Venna.

However, the Bond Commitment failed to result in financing.

As DT had been unable to obtain new financing, the Wellington Project was sold in October 2019.

In October 2019, Jeshuren and Romola provided DT with a mortgage commitment purportedly from Calico Developments Inc. (“Calico”) for $1,500,000 (the “Calico Commitment”).

The address on the Calico Commitment is 80 Maritime Ontario Boulevard, Brampton. While there is a validly incorporated company named Calico Developments Inc., it is located at a different address.

A principal of Calico states that it did not issue the Calico Commitment.

In November 2019, Jeshuren and Romola provided DT with an “Offer to Finance” purportedly from Babar Zaheer Ud-Din (“Babar”) for $5,500,000 (the “Babar Commitment”).

Both Jeshuren and Romola provided their contact information on the Babar Commitment. Romola provided her email addresses as “nacclegalservices@gmail.com” and “easymortgage@hotmail.com”.

Babar states that he did not draft the Babar Commitment. Babar further states that Romola and Jeshuren approached him regarding issuing financing in respect of properties owned by DT, but he turned them down because they asked for too much money.

The provisions and appearance of the Calico Commitment and the Babar Commitment were substantially the same.

Neither the Calico Commitment nor the Babar Commitment resulted in financing.

(ii) The Peel Property

Through a different numbered company, DT also owned a property on Peel Street in Toronto (the “Peel Property”). In or around the same time that he was developing the Wellington Project, DT was also developing a residential project on the Peel Property.

DT needed funds to try and avoid having the Wellington Project go into receivership. In or around August 2019, Romola and Jeshuren told DT that they could arrange a third mortgage with respect to the Peel Property.

DT met with, texted with, and spoke on the telephone to both Romola and Jeshuren with respect to their efforts to arrange a third mortgage on the Peel Property. Romola arranged for DT to be represented by a lawyer in respect of the mortgage transaction. DT sent copies of utility bills, tax returns, financial statements, and other documents related to the Peel Property to Jeshuren.

On August 20, 2019, Romola and Jeshuren successfully arranged mortgage financing from Angel Capital Finance Inc. for $150,000 with respect to the Peel Property (the “Peel Mortgage”). The Peel Mortgage charged interest of 18%, and charged a “Lender’s Fee” of $15,000.

DT’s understanding was that Romola and Jeshuren received this $15,000 “Lender’s Fee.”

After fees and interest prepayments, DT received $98,340 as a result of the Peel Mortgage.

D. Dealing in Mortgages with Respect to “PB”

“PB” is an Ontario resident. Romola, Jeshuren, and NACCLS dealt in mortgages with respect to PB.

In or around June 2018, PB loaned $155,000 to “MW” secured by a second mortgage on a property in Brampton (the “Brampton Property”). However, MW regularly failed to make payments to PB in respect of this loan.

In or around March of 2019, MW introduced PB to Romola. Romola told PB that she was a mortgage broker. Romola further told PB that she could refinance the Brampton Property such that PB would be repaid.

Romola provided PB a document to sign that Romola said would result in PB being repaid. PB did not understand the nature of this document. However, PB relied on Romola’s representations and signed this document in March of 2019.

Unbeknownst to PB, the document she signed was a postponement agreement with respect to the Brampton Property. Romola subsequently placed another mortgage on the Brampton Property in priority to the mortgage in favor of PB.

Romola then contacted PB and told her that she and Jeshuren were “big players” in the mortgage and real estate industry and could help her invest her money.

PB met with Romola and Jeshuren in April 2019. Romola and Jeshuren told PB that they were mortgage brokers and property builders. Romola and Jeshuren also told PB that they operated NACCLS, and that NACCLS was a law firm. Jeshuren told PB that he was also a real estate agent and the president of NACCLS.

Romola and Jeshuren told PB that if she provided them with funds, they would loan her funds to borrowers and secure her investment with mortgages. Romola and Jeshuren also told PB that all legal work would be done by NACCLS.

PB provided Romola and Jeshuren with seven bank drafts made payable to NACCLS totaling $227,750 that they told her would be used to issue mortgages:

Date	Amount
June 3, 2019	$66,250
June 21, 2019	$40,000
June 26, 2019	$4,500
June 26, 2019	$6,000
June 26, 2019	$12,000
July 6, 2019	$36,000
July 6, 2019	$63,000

Jeshuren subsequently told PB that she was required to pay him commission for brokering these purported mortgages. At Jeshuren’s direction, on July 6, 2019, PB provided Jeshuren with two bank drafts made payable to him personally totaling $5,500.

PB became concerned that she had not received any documents regarding her investments, and that she was not being repaid. Romola and Jeshuren gave PB a variety of excuses.

Eventually, Romola provided PB with a document titled “2nd mortgage commitment” dated July 5, 2019. This document stated that PB had loaned $40,000 at an interest rate of 15% via a second mortgage secured by a property. It also stated that a “fee” of 10% had been charged.

“Jeshuren Anandarajah (NACC Legal Services)” subsequently e-transferred PB a total of $14,800, which Jeshuren told PB were payments in respect of the mortgages that Romola and Jeshuren had purportedly arranged:

Date	Amount
August 5, 2019	$700
September 3, 2019	$2,000
February 6, 2020	$3,000
February 15, 2020	$200
March 2, 2020	$1,000
April 28, 2020	$200
May 22, 2020	$3,200
June 2, 2020	$2,500
July 1, 2020	$1,000
July 21, 2020	$1,000

PB has not been repaid anymore of the $227,750 that she provided to NACCLS.

In February 2020, Jeshuren contacted PB and told her that he was trying to refinance the Brampton Property. Jeshuren told PB that if she again postponed her mortgage on the Brampton Property and reduced the amount of her outstanding mortgage to $25,000, she would be repaid $25,000. PB did not agree to do so.

The Brampton Property was later sold under power of sale, and PB received none of the proceeds.

III. CONTRAVENTIONS OR FAILURES TO COMPLY WITH THE ACT

A. Dealing in Mortgages Without Being Licensed under the Act

Subsection 2(3) of the Act states that “No individual shall deal in mortgages in Ontario for remuneration, whether direct or indirect, as an employee or otherwise, unless he or she has a mortgage broker’s or agent’s licence and is acting on behalf of a mortgage brokerage or is exempted from the requirement to have such a licence.”

The Director is satisfied that Romola contravened subsection 2(3) of the Act by dealing in mortgages with respect to JH, DT, and PB without being licensed under the Act.

The Director is satisfied that Jeshuren contravened subsection 2(3) of the Act by:
1. Dealing in mortgages with respect to DT between December 2018 and March 26, 2019, during which time his license was suspended pursuant to paragraph 17(3)(a) of the Act;
2. Dealing in mortgages with respect to DT between September 4, 2019, and December 2019, during which time his license was suspended pursuant to paragraph 17(3)(a) of the Act; and
3. Dealing in mortgages with respect to PB in February 2020, at which time his license was suspended pursuant to paragraph 17(3)(a) of the Act.

Subsection 2(2) of the Act states that “No person or entity shall carry on the business of dealing in mortgages in Ontario unless he, she or it has a brokerage licence or is exempted from the requirement to have such a licence.”

The Director is satisfied that NACC contravened subsection 2(2) of the Act by dealing in mortgages with respect to JH without being licensed under the Act.

The Director is satisfied that NACCLS contravened subsection 2(2) of the Act by dealing in mortgages with respect to PB without being licensed under the Act.

B. False or Deceptive Information or Documents

Subsection 43(2) of the Act states “No mortgage broker or agent shall give, assist in giving or induce or counsel another person or entity to give or assist in giving any false or deceptive information or document when dealing in mortgages in Ontario or trading in mortgages in Ontario.”

The Director is satisfied that Jeshuren contravened subsection 43(2) of the Act by providing the Bond Commitment to DT in April of 2019. The Bond Commitment was false or deceptive as it was not issued by The Bond Group.

The Director is also satisfied that Jeshuren contravened subsection 43(2) of the Act by providing false or deceptive information and documents to PB between March 27, 2019, and September 3, 2019. Specifically, and contrary to Jeshuren’s representations:
1. Romola was not licensed under the Act;
2. NACCLS was not a law firm;
3. Jeshuren did not use the funds PB advanced to NACCLS to issue mortgages;
4. Jeshuren did not secure the funds PB advanced to NACCLS with mortgages; and
5. PB was not required to pay Jeshuren commission.

C. Dishonesty and Fraud

Subsection 3.1 of O. Reg. 187/08 of the Act states that a mortgage broker or agent shall not act, or do anything or omit to do anything, in circumstances where he or she ought to know that by acting, doing the thing or omitting to do the thing, he or she is being used by a borrower, lender, investor or any other person to facilitate dishonesty, fraud, crime or illegal conduct.

The Director is satisfied that Jeshuren contravened subsection 3.1 of O. Reg. 187/08 by acting or omitting to act in circumstances where he ought to have known that such actions or omissions to act would facilitate dishonesty, fraud, crime, or illegal conduct by Romola:
1. Jeshuren failed to correct Romola’s false representations to DT that she was licensed under the Act;
2. Jeshuren acted with Romola to issue the Bond Commitment, despite Romola not being licensed under the Act and the Bond Commitment being false or deceptive;
3. Jeshuren acted with Romola to arrange the Peel Mortgage, despite Romola not being licensed under the Act;
4. Jeshuren failed to correct Romola’s false representations to PB that she was licensed under the Act;
5. Jeshuren failed to correct Romola’s false representations to PB that NACCLS was a law firm;
6. Jeshuren failed to correct Romola’s false representations to PB that if she provided them with funds, they would loan her funds to borrowers and secure her investment with mortgages; and
7. Jeshuren acted in concert with Romola to fraudulently obtain $227,750 from PB.

D. Receiving Remuneration From Person Other Than Brokerage

Subsection 4(1) of O. Reg. 187/08 states “A mortgage broker or agent shall not receive, directly or indirectly, any fee or other remuneration for dealing or trading in mortgages from a person or entity other than the brokerage on whose behalf he or she is authorized to deal or trade in mortgages.”

The Director is satisfied that Jeshuren contravened subsection 4(1) of O. Reg. 187/08 by receiving a fee of $15,000 in respect of the Peel Mortgage from a person or entity other than Valor.

The Director is also satisfied that Jeshuren contravened subsection 4(1) of O. Reg. 187/08 by receiving fees of $5,500 in respect of his dealings in mortgages from PB, a person other than Valor.

IV. GROUNDS TO ISSUE CEASE AND DESIST ORDER

Subsection 35(1) of the Act states that a cease and desist order may be imposed if the Director is of the opinion that:
1. a person or entity is committing any act or pursuing any course of conduct that contravenes or does not comply with a requirement established under this Act;
2. a person or entity is committing any act or pursuing any course of conduct that might reasonably be expected to result in a state of affairs that would contravene or not comply with a requirement established under this Act; or
3. a person or entity has committed any act or pursued any course of conduct that contravenes or does not comply with a requirement established under this Act.

The Director is of the opinion that Jeshuren, Romola, NACC, and NACCLS committed and/or are committing an act or have pursued and/or pursuing a course of conduct that contravenes the Act. The Director is of the opinion that the proposed order is necessary to remedy the situation.

The public may engage Jeshuren, Romola, NACC, and/or NACCLS to provide mortgage services under the misapprehension that they are licensed to do so. This will deprive individuals of the ability to rely on a suitable, licensed individual and brokerage and may pose harm if the services are provided without regard to the requirements of the Act and Regulations.

There is substantial evidence that Jeshuren, Romola, NACC, and NACCLS are or were operating a mortgage services business, without a licence, contrary to section 2 of the Act. Accordingly, the Director proposes to issue a cease and desist order requiring that Jeshuren, Romola, NACC, and NACCLS cease dealing in mortgages contrary to the Act.

V. GROUNDS FOR IMPOSING ADMINISTRATIVE PENALTIES

The Director is satisfied that imposing administrative penalties on Jeshuren under section 39 of the Act will satisfy one or both of the following purposes under section 38(1) of the Act:
1. To promote compliance with the requirements established under the Act.
2. To prevent a person or entity from deriving, directly or indirectly, any economic benefit as a result of contravening or failing to comply with a requirement established under the Act.

The Director is satisfied that five administrative penalties in the total amount of $50,000 should be imposed on Jeshuren as follows:
1. $10,000 for contravening subsection 43(2) of the Act by providing false or deceptive information to DT;
2. $10,000 for contravening subsection 43(2) of the Act by providing false or deceptive information to PB;
3. $10,000 for contravening subsection 3.1 of O. Reg. 187/08 by acting or omitting to act in circumstances where he ought to have known that such actions or omissions to act would facilitate dishonesty, fraud, crime, or illegal conduct by Romola;
4. $10,000 for contravening subsection 4(1) of O. Reg. 187/08 by receiving the Lender’s Fee in respect of the Peel Mortgage from DT and not from Valor; and
5. $10,000 for contravening subsection 4(1) of O. Reg. 187/08 by receiving the $5,500 from PB and not from Valor.

In determining the amount of the administrative penalties, the Director has considered the following criteria as required by section 3 of Ontario Regulation 192/08:
1. The degree to which the contravention or failure was intentional, reckless or negligent.
2. The extent of the harm or potential harm to others resulting from the contravention or failure.
3. The extent to which the person or entity tried to mitigate any loss or take other remedial action.
4. The extent to which the person or entity derived or reasonably might have expected to derive, directly or indirectly, any economic benefit from the contravention or failure.
5. Any other contraventions or failures to comply with a requirement established under the Act or with any other financial services legislation of Ontario or of any jurisdiction during the preceding five years by the person or entity.

In respect of the first criterion, the Director is satisfied that Jeshuren’s actions were intentional. Over multiple years and while being licensed through multiple brokerages, Jeshuren repeatedly and intentionally, on his own and in concert with Romola, engaged in dishonest and fraudulent acts. Jeshuren:
1. Dealt in mortgages with respect to DT during two separate periods during which time his license was suspended pursuant to paragraph 17(3)(a) of the Act;
2. Dealt in mortgages with respect to PB during a time his license was suspended pursuant to paragraph 17(3)(a) of the Act;
3. Either by himself or with Romola, created the false or deceptive Bond Commitment and provided it to DT;
4. Provided false or deceptive information to PB, namely, that Romola was licensed under the Act, that NACCLS was a law firm, that he would use the funds PB advanced to NACCLS to issue mortgages, that he would secure the funds PB advanced to NACCLS with mortgages, and that PB was required to pay Jeshuren commission;
5. Acted or omitted to act in circumstances where he ought to have known that such actions or omissions to act would facilitate dishonesty, fraud, crime, or illegal conduct by Romola, namely, failed to correct Romola’s false representations to DT that she was licensed under the Act, acted with Romola to issue the Bond Commitment, which was false or deceptive, acted with Romola to arrange the Peel Mortgage, despite Romola not being licensed under the Act, failed to correct Romola’s false representations to PB that she was licensed under the Act, failed to correct Romola’s false representations to PB that NACCLS was a law firm, failed to correct Romola’s false representations to PB that if she provided them with funds, they would loan her funds to borrowers and secure her investment with mortgages, and acted with Romola to fraudulently obtain $227,750 from PB;
6. Either by himself or with Romola, arranged to receive the Lender’s Fee in respect of the Peel Mortgage from DT and not from Valor; and
7. Either by himself or with Romola, arranged to receive $5,500 from PB and not from Valor.

In respect of the second criterion, the Director is satisfied that Jeshuren’s activities caused significant harm to DT and PB and created the potential for significant harm to the market in general:
1. As a result of Jeshuren providing the false or deceptive Venna Commitment, Bond Commitment, Calico Commitment, and Babar Commitment to DT, DT failed to obtain financing with respect to the Wellington Project. This failure resulted in the Wellington Project going into receivership and being sold, which cause DT to incur a significant financial loss;
2. By placing other mortgages in priority to PB’s mortgage on the Brampton Property, Jeshuren caused PB to lose her entire $155,000 investment;
3. Jeshuren directed PB to pay $227,750 to NACCLS, failed to secure the investment of these funds with mortgages, and caused PB to incur a loss of at least $218,450;
4. The dissemination of false or deceptive documents in general carries the potential to undermine the integrity and stability of the housing market. It also has the potential to encourage other agents and participants in the mortgage industry, further undermining the integrity of the Act and the mortgage sector; and
5. By accepting brokerage fees directly and not through Valor, Jeshuren undermined the oversight function that brokerages are required to play within Ontario’s mortgage industry. Brokerages must maintain oversight over fees and other remuneration charged in connection with mortgage transactions in order to ensure that client funds are not misappropriated and clients are not charged unauthorized or inappropriate fees.

In respect of the third criterion, Jeshuren has made no efforts to mitigate DT or PB’s loss or take other remedial action.

In respect of the fourth criterion, as a result of Jeshuren’s failure to comply with the Act, Jeshuren derived a direct economic benefit of $218,450 (net) from PB plus the Lender’s Fee of $15,000 from DT.

In respect of the fifth criterion, the Director is unaware of any further contraventions or failures to comply in the preceding five years by Jeshuren.

Such further and other reasons as may come to my attention.

DATED at Toronto, Ontario, July 8, 2021.

Original signed by

Elissa Sinha
Director, Litigation & Enforcement
Financial Services Regulatory Authority of Ontario

By delegated authority from the Chief Executive Officer

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