Disclaimer
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 FSRA’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.
Financial Services Regulatory Authority of Ontario

IN THE MATTER OF the Mortgage Brokerages, Lenders and Administrators Act, 2006, S.O. 2006, c. 29, as amended (the “Act”), in particular sections 16, 19, 21, 38, and 39; 

AND IN THE MATTER OF Ranjit Dhillon, Aid Almusri, Kamal Dhillon, and Mortgage Smart Inc.


NOTICE OF PROPOSAL TO REFUSE TO RENEW LICENCE,
NOTICE OF PROPOSAL TO REVOKE LICENCE, AND
NOTICE OF PROPOSAL TO IMPOSE ADMINISTRATIVE PENALTIES

TO: Ranjit Dhillon

AND TO: Aid Almusri

AND TO: Kamal Dhillon

AND TO: 
Mortgage Smart Inc.
7956 Torbram Road
Brampton, L4T 3Y8

TAKE NOTICE THAT pursuant to Sections 16 and 21 of the Act, by delegated authority from the Chief Executive Officer of the Financial Services Regulatory Authority of Ontario (the “Chief Executive Officer”), the Director, Litigation and Enforcement (the “Director”) is proposing to refuse to renew the mortgage broker licence issued to Ranjit Dhillon (licence # M08000576).

AND TAKE NOTICE THAT pursuant to Sections 16 and 21 of the Act, by delegated authority from the Chief Executive Officer, the Director is proposing to refuse to renew the mortgage agent licence issued to Aid Almusri (licence # M21003430).

AND TAKE NOTICE THAT pursuant to Sections 19 and 21 of the Act, by delegated authority from the Chief Executive Officer, the Director is proposing to revoke the mortgage broker licence issued to Kamal Dhillon (licence # M08010429).

AND TAKE NOTICE THAT pursuant to Sections 19 and 21 of the Act, by delegated authority from the Chief Executive Officer, the Director is proposing to revoke the mortgage brokerage licence issued to Mortgage Smart Inc. (licence # 12076).

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 the following administrative penalties:

  1. thirteen (13) administrative penalties in the total amount of $80,000 on Ranjit Dhillon for contravening section 3 of Ontario Regulation 187/08 by causing Mortgage Smart Inc. to contravene subsections 24(1), 25(1), 27(1), and 48(1) of Ontario Regulation 188/08, and for contravening subsections 43(2) and 45(2) of the Act;

  2. thirteen (13) administrative penalties in the total amount of $77,000 on Aid Almusri for contravening section 3 of Ontario Regulation 187/08 by causing Mortgage Smart Inc. to contravene subsections 24(1), 25(1), and 27(1) of Ontario Regulation 188/08, and for contravening subsections 43(2) and 45(1) of the Act;

  3. three (3) administrative penalties in the total amount of $22,500 on Kamal Dhillon for contravening subsections 2(1) and 3(1) of Ontario Regulation 410/07 and Section 43(2) of the Act; and

  4. twenty-nine (29) administrative penalties in the total amount of $170,000 on Mortgage Smart Inc. for contravening subsections 9(1), 24(1), 25(1), 27(1), and 48(1) of Ontario Regulation 188/08, and subsections 43(1) and 45(2) of the Act.

Details of these contraventions and reasons for this proposal are described below. This Notice of Proposal includes allegations that may be considered at a hearing.

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 SECTIONS 21(2) AND 21(3), 39(2) AND 39(5) 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 15 (fifteen) 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 W, Suite 100
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. TAKE FURTHER NOTICE of the payment requirements in section 4 of Ontario Regulation 192/08, which state that the penalized person or entity shall pay the penalty no later than 30 (thirty) days after the person or entity is given notice of the order imposing the penalty, after the matter is finally determined if a hearing is requested or such longer time as may be specified in the order.

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

  1. These are the reasons for the proposal by the Director to:
    1. refuse to renew the mortgage broker licence issued to Ranjit Dhillon;

    2. refuse to renew the mortgage agent licence issued to Aid Almusri (“Almusri”);

    3. revoke the mortgage broker licence issued to Kamal Dhillon;

    4. revoke the mortgage brokerage licence issued to Mortgage Smart Inc. (“Mortgage Smart”); and

    5. impose administrative penalties on Ranjit Dhillon, Almusri, Kamal Dhillon, and Mortgage Smart.


    2. II. BACKGROUND

    A. Parties

  2. Ranjit Dhillon was licensed as a mortgage broker (licence # M08000576) under the Act since July 1, 2008, until the expiry of his licence on March 31, 2023. Ranjit Dhillon applied to renew his licence on March 14, 2023.

  3. Almusri was licensed as a mortgage broker (licence # M21003430) under the Act since September 3, 2021, until the expiry of his licence on March 31, 2023. Almusri applied to renew his licence on February 27, 2023.

  4. Kamal Dhillon is licensed as a mortgage broker (licence # M08010429) under the Act and has been licenced since August 25, 2008. Kamal Dhillon and Ranjit Dhillon are spouses.

  5. Mortgage Smart Inc. is licenced as a mortgage brokerage under the Act (licence # 12076) and has been licenced as such since January 13, 2011. Kamal Dhillon is the owner, sole director, and principal broker of Mortgage Smart.

  6. At all material times, Kamal Dhillon was the principal broker and director of Mortgage Smart. Ranjit Dhillon and Almusri were authorized to deal and trade in mortgages by and on behalf of Mortgage Smart. Ranjit Dhillon is presently a mortgage broker at Mortgage Smart. Almusri is presently employed as a mortgage agent at Mortgage Maven, a mortgage brokerage licensed under the Act.

  7. Between January 2021 and December 2022, Almusri was associated with and/or employed at 2799953 Ontario Inc. operating as Canada’s Choice Capital (“CCC”), a corporation which provided home services and products. Almusri was, or represented himself as, the Chief Operating Officer of CCC. Certain services and products offered by CCC were sold through door-to-door salespersons.

  8. Ranjit Dhillon, in an interview with FSRA on July 25, 2023, stated that in or around mid-2021, Ranjit Dhillon met a group of persons which included AAY, the president and sole director of CCC, and DH, a lawyer, to discuss the brokering of mortgages for persons who purchased CCC products and services and owed money for the same.

  9. Between June 2021 and February 2022, Mortgage Smart brokered at least 50 mortgages for CCC clients and other persons who purchased home services. Canada’s Choice Investments Inc. (“CCI”), a private lender, was the lender in at least 43 of these mortgages. AAY was the sole director of CCI during the same period.

    10. B. Misconduct while Dealing in Mortgages

    Overview

  10. Between June 2021 and February 2022, Mortgage Smart, through Ranjit Dhillon and Almusri, arranged mortgages for six clients, BB, JC, RC/DC, MC, JG, and GB (collectively, the “Borrowers”) from private lenders, including CCI. Mortgage Smart represented the Borrowers and the lenders in each of the mortgage transactions which are outlined below.

  11. All of the Borrowers were vulnerable senior citizens. They were all pensioners with annual fixed incomes ranging from $16,000 to $50,000. Furthermore, certain Borrowers stated to FSRA that they were suffering from health and age-related issues which hampered their ability to comprehend the nature of the mortgage transactions and give informed consent.

  12. The Borrowers had multiple Notices of Security Interest (“NOSIs”) registered on their residential properties. Most of these NOSIs arose from home service contracts sold by door-to-door salespersons. At least one NOSI on each of the properties was held by CCC.

  13. The Borrowers were referred to Mortgage Smart and Ranjit Dhillon by CCC either through AAY, Almusri, MH - a former mortgage agent, or by door-to-door salespersons. Ranjit Dhillon stated that clients such as the Borrowers were represented to Mortgage Smart and Ranjit Dhillon as CCC “clients”.

  14. All of the Borrowers retained DH, who was recommended by Ranjit Dhillon and Mortgage Smart, for legal representation for the transactions. DH’s lawyer licence was suspended on an interlocutory basis by the Law Society of Ontario by order dated June 2, 2023 for misconduct relating to some of the transactions, finding that there were reasonable grounds for believing DH presented a significant risk of harm to the public and to the public interest in the administration of justice.

  15. While arranging the mortgages for the Borrowers, Mortgage Smart, Ranjit Dhillon, and Almusri, among other things,

    1. did not take reasonable steps to determine if the mortgages arranged for the Borrowers were suitable;

    2. did not disclose, in writing, to the Borrowers the specific material risks associated with the mortgages;

    3. did not disclose certain conflict-of-interest issues associated with the mortgages;

    4. in at least one case, arranged a mortgage without the client’s knowledge; and

    5. provided false and/or deceptive information in the mortgage application forms.

  16. Further, Mortgage Smart and Kamal Dhillon, among other things, did not take adequate steps to ensure that the conduct of Ranjit Dhillon and Almusri were in compliance with the Act and its regulations, nor did they take any steps to address the aforesaid misconduct even after receiving complaints from four of the Borrowers.

    17. B.1 The BB Mortgage

  17. In June-July 2021, Ranjit Dhillon, as a mortgage broker with Mortgage Smart, arranged a $400,000 mortgage from CCI for BB (the “BB Mortgage”).

  18. BB was 72 years old at the time when the mortgage application for the BB Mortgage was submitted. The application stated that BB was a retired pensioner with an annual income of $30,000. BB’s residential property in Scarborough (the “BB Property”) was put forward as security. The transaction closed on July 6, 2021.

  19. The Scarborough Property was unencumbered until April 2021, when at least one NOSI securing approximately $9,200 was registered on the property by CCC.

  20. Investigation into the BB Mortgage, among other things, revealed that,

    1. The term of the mortgage was 1 year with an annual interest rate of 25%. BB was required to make interest only payments of $8,333 every month;

    2. The interest on the mortgage, amounting to approximately $100,000, was to be prepaid from the mortgage proceeds. The entire principal amount was to become due after the expiry of the 1-year term;

    3. The total disclosed cost of borrowing for the BB Mortgage amounted to $121,999.96 with an APR of 30.5%;

    4. CCC, or a person associated with CCC, referred Mortgage Smart and Ranjit Dhillon to BB; and

    5. Although Mortgage Smart claimed that the mortgage documents were signed via video-conference, FSRA was advised by BB’s niece, that BB did not have internet and did not know how to use a computer. An email account - “dhillonk75@gmail.com” was represented as BB’s email account in the application form for the BB Mortgage. BB did not have an email account at the time.

    21. B.2 The JC Mortgage

  21. In June 2021, Ranjit Dhillon, as a mortgage broker with Mortgage Smart arranged a $550,000 mortgage from CCI and 2747101 Ontario Inc. for JC (the “JC Mortgage”).

  22. JC was 69 years old at the time when the mortgage application for the JC Mortgage was submitted. The application stated that JC was a retired pensioner with an annual income of around $49,000. JC’s residential property in Toronto (the “JC Property”) was put forward as security. The transaction closed on July 13, 2021.

  23. JC stated in her complaint to FSRA that during the relevant time she was suffering from multiple health issues which affected her ability to understand the nature and details of the transaction.

  24. JC stated to FSRA that beginning in or around 2016 she was pressured and/or induced into procuring several home services. NOSIs relating to such products and services as well as other mortgages, securing approximately $161,000, were registered on the title to the JC property. CCC held two of these NOSIs.

  25. Investigation into the JC Mortgage revealed that,

    1. The term of the mortgage was 1 year with an annual interest rate of 25%. JC was required to make interest-only payments of $11,458.33 every month;

    2. The application form for the JC mortgage, dated June 12, 2021, contained false information relating to the JC Property and JC’s liabilities;

    3. Interest on the mortgage, amounting to $137,499.96, was to be prepaid from the mortgage proceeds. The entire principal amount was to become due after the expiry of the 1-year term;

    4. The total disclosed cost of borrowing for the JC Mortgage amounted to $177,999.36 with an APR of 32.364%;

    5. CCC or a person associated with CCC referred Mortgage Smart to JC;

    6. JC denied ever meeting the witness to the disclosure document and a letter of direction both dated June 12, 2021, which were prepared with the mortgage application; and

    7. JC stated that she does not recall meeting Ranjit Dhillon at the time that the JC Mortgage was being arranged.


    26. B.3 The RC/DC Mortgage

  26. During December 2021-February 2022 Almusri, as a mortgage agent with Mortgage Smart, arranged a $300,000 mortgage from Armada Mortgage for RC and DC (the “RC/DC Mortgage”). Ranjit Dhillon was involved in liaising with the lender.

  27. RC was 75 years old, and DC was 71 years old at the time when the mortgage application for the RC/DC Mortgage was submitted. RC and DC were retired pensioners with a combined annual income of around $34,382.28. Their residential property in Brampton (the “RC/DC Property”) was put forward as security. The transaction closed on February 9, 2022.

  28. A complaint by RC and DC’s son to FSRA stated that they had low educational attainment and during the relevant time were suffering from health issues and limited mobility.

  29. The complaint further stated that from June 2019, they were deceived into procuring several home services and products by door-to-door salespersons and by November 2021, several NOSIs relating to such products and services as well as a mortgage, securing approximately $195,000, were registered on the title to the RC/DC property. CCC held one of the said NOSIs.

  30. The complaint also stated that one of the aforementioned door-to-door salespersons introduced RC and DC to Almusri, who represented himself as a “energy sales representative” and promised to buy out RC and DC’s home service contracts and claimed that RC and DC would lose the RC/DC property if it was not brought “up to standard”.

  31. Investigation into the RC/DC Mortgage revealed that,

    1. An application form for the RC/DC Mortgage, dated December 23, 2021, prepared and submitted by Almusri, sought a $400,000 mortgage. It contained false and deceptive information relating to RC and DC’s assets and the RC/DC Property;

    2. A second and final application form for the RC/DC Mortgage, dated January 13, 2022, was also prepared and submitted by Almusri. It contained the same false and deceptive information as the first application form;

    3. As per the second application form, the term of the mortgage was 1 year and with an annual interest rate of 5.75%. RC and DC were required to make interest only payments of $1,437.50 every month. The total cost of borrowing amounted to $29,350 at an APR of 9.783%;

    4. An interest reserve amounting to $17,250 was to be deducted from the mortgage proceeds; and

    5. RC and DC received $103,796 of the total mortgage amount of $300,000 after discharge of mortgages and other securities, taxes, payments of fees, and deduction of interest reserve.


  32. As per the complaint, RC and DC never wanted a mortgage and did not understand the nature and content of the documents relating to the RC/DC Mortgage. They were made to understand that the mortgage proceeds amounting to $103,796 were rebates and refunds from home service companies.

    33. B.4 The MC Mortgage

  33. During December 2021-January 2022, Almusri, as a mortgage agent with Mortgage Smart, arranged a $325,000 mortgage from Hosper Mortgage for MC (the “MC Mortgage”). Ranjit Dhillon was involved in liaising with the lender.

  34. MC was 66 years old at the time when the mortgage application for the MC Mortgage was submitted. MC was a retired pensioner with an annual income of around $16,162. Her residential property in Brampton (the “MC Property”) was put forward as security. The transaction closed on January 24, 2022.

  35. A complaint filed by ST, MC’s power of attorney for property, to FSRA states that MC was diagnosed with mental health issues and has been under treatment for the past 20 years and that that she is unable to make property related decisions.

  36. The complaint stated that beginning in or around late 2020 she was pressured and/or induced into procuring several home services and products by door-to-door salespersons. By June 2021, NOSIs relating to such products and services, securing approximately $42,000, were registered on the title to the MC property. CCC held one of the said NOSIs.

  37. Investigation into the MC Mortgage revealed that,

    1. The application form for the MC Mortgage, dated January 7, 2022, prepared and submitted by Almusri, contained false and deceptive information relating to MC’s assets and liabilities;

    2. The term of the mortgage was 1 year with an annual interest rate of 7.49%. MC was required to make interest only payments of $2,028 every month. The total cost of borrowing amounted to $40,567.48 at an APR of 12.48%;

    3. Pre-paid interest amounting to $24,342.48 was to be deducted from the mortgage proceeds;

    4. MC’s complaint states that she was introduced to Almusri by a door-to-door salesperson who had pressured and/or induced MC into obtaining one of the aforesaid home service products; and

    5. CCC received $6,500 as “mortgage referral fees” separate from the $8,125 “broker fee” paid to Mortgage Smart. CCC in a communication to MC’s legal representative stated that this money was forwarded to Almusri.


  38. The complaint also stated that ST brought the issues relating to the MC Mortgage to the notice of Ranjit Dhillon. Ranjit Dhillon advised ST that Mortgage Smart would refund the brokerage fee amounting to $8,125 to MC. The fee was never refunded.

    39. B.5 The JG Mortgage

  39. In June 2021 Ranjit Dhillon, as a mortgage broker with Mortgage Smart, arranged a $200,000 mortgage from CCI for JG (the “JG Mortgage”).

  40. JG was 79 years old at the time when the mortgage application for the JG Mortgage was submitted. JG was a retired pensioner with an annual income of around $45,000. Her residential property in Peterborough (the “JG Property”) was put forward as security. The transaction was closed on June 9, 2021.

  41. JG stated in her complaint that she has health issues and low educational attainment. She was also unable to read small font due to poor eyesight.

  42. JG’s complaint stated that beginning in or around 2012 she was pressured and/or induced into procuring several home services and products by door-to-door salespersons. Between August 2019 and April 2021, several NOSIs and a mortgage relating to such products and services, securing approximately $132,000, were registered on the title to the JG property. CCC held one of the said NOSIs.

  43. Investigation into the JG Mortgage revealed that,

    1. The application form for the JG Mortgage, dated June 2, 2021, prepared and submitted by Ranjit Dhillon, contained false and deceptive information relating to JG’s assets and liabilities;

    2. The term of the mortgage was 1 year and with an annual interest rate of 25%. JG was required to make interest only payments of $4,166.67 every month which significantly exceeded her income. The total cost of borrowing amounted to $60,800.04 at an APR of 30.4%;

    3. The disclosure to the borrower document provided to JG was not signed by Ranjit Dhillon. However, a copy of the same document provided to FSRA by Ranjit Dhillon and Mortgage Smart included Ranjit Dhillon’s signature;

    4. Interest on the mortgage, amounting to $50,000, was to be prepaid from mortgage proceeds. The entire principal amount was to become due after the expiry of the 1-year term;

    5. JG stated in her complaint that she could not recall signing the transaction documents, including the mortgage application, for the JG Mortgage or meeting Ranjit Dhillon; and

    6. JG stated that she was referred to Mortgage Smart and Ranjit Dhillon by a door-to-door salesperson who had pressured and/or induced JG into obtaining the aforesaid home service products.


  44. JG defaulted on the JG Mortgage and CCI commenced a foreclosure action for possession of the JG property on June 7, 2022. JG filed a statement of defence and counter-claim in response to the action.

    45. B.6 The GB Mortgage

  45. During December 2021 and January 2022 Almusri, as an agent with Mortgage Smart, was involved in arranging a $312,000 mortgage from Armada Mortgage for GB (the “GB Mortgage”). Ranjit Dhillon was involved in liaising with DH, GB’s lawyer for the transaction.

  46. GB was 72 years old at the time when the mortgage application for the GB Mortgage was submitted. GB was a retired pensioner with an annual income of around $33,000. He stated in his complaint to FSRA that he suffered from epilepsy and memory related issues. His residential property in Cambridge (the “GB Property”) was put forward as security. The transaction closed on January 14, 2022.

  47. GB stated in his complaint that beginning in or around 2013 he was pressured and/or induced into procuring several home services and products by door-to-door salespersons and was referred to Almusri by one of the salespersons. This included agreeing to a home renovation which was to be financed by CCC. CCC registered a NOSI, securing approximately $35,000, on the title of the GB Property in this respect.

  48. Investigation into the GB Mortgage revealed that,

    1. An application form for the GB Mortgage, dated December 6, 2021, prepared and submitted by Almusri, contained false and deceptive information relating to GB’s assets. The mortgage amount applied for was $325,000 with a 1-year term with an annual interest rate of 5.75%. The value of the GB Property was stated as $880,000;

    2. Ranjit Dhillon’s assistant at Mortgage Smart in an email, dated December 6, 2021, directed an appraiser to seek payment for the appraisal of the GB Property from AAY. CCC paid the $355.55 appraisal fee. The value of the GB Property was appraised at $765,000;

    3. Following the appraisal of the property a second mortgage application, dated December 14, 2021, was prepared by Almusri. The application contained the same false information as the earlier application and the property value was not updated as per the appraisal report;

    4. As per the revised terms of the GB Mortgage, the mortgage amount was $312,000 with a 1-year term and an annual interest rate of 5.75%. JG was to make interest only payments of $1,495 every month The total cost of borrowing was stated as $31,710 at an APR of 10.16%;

    5. The first application was made out to “Centum Mortgage”. The lender section of the second application stated “Not Assigned”; and

    6. An “interest reserve” amounting to $18,240 was deducted from the mortgage proceeds.

    49. B.7 Relating to multiple Borrowers

  49. Ranjit Dhillon, Almusri, and Mortgage Smart took no steps to take into account the Borrower’s advanced age, health conditions, educational qualifications, and financial circumstances prior to arranging the mortgages. Ranjit Dhillon, Almusri, and Mortgage Smart collected little or no information from the Borrowers in this respect apart from basic details relating to the Borrower, the property to be mortgaged, and their income.

  50. Ranjit Dhillon and Almusri did not present any other mortgage options apart from those finalized in the mortgage applications. They also did not take reasonable and sufficient steps to specifically confirm if the mortgages were appropriate for the needs and circumstances of the Borrowers. In all cases the mortgage amounts greatly exceeded the amount required to discharge the NOSIs and mortgages registered on the Borrowers’ properties.

  51. FSRA’s investigation revealed that the application forms for the JC, JG, and BB Mortgages were altered after the form had been signed by the Borrower. Such alterations include changes to the names of the lender and the Borrower’s lawyer. There is no record of JC, JG, and BB consenting to such alterations.

  52. The written disclosure of material risks provided to each of the above Borrowers did not state any transaction specific risks which took into account the onerous nature of certain mortgage terms as well as the profile and circumstances of the Borrowers. The disclosure only stated as follows:

    “The brokerage has reviewed with the borrower the general risks associated with a mortgage commitment. These risks include: risk of falling into arrears, default and foreclosure, prepayment penalties etc.”


  53. Ranjit Dhillon claimed that most of the client information for CCC referrals, which included the Borrowers, were sourced from CCC directly or through Almusri and MH. However, Almusri claimed that Ranjit Dhillon provided all client information and documents to him and that he completed mortgage applications and other related tasks under Ranjit Dhillon’s direction and supervision while at Mortgage Smart.

  54. Almusri also provided certain recorded phone conversations to FSRA stating that they were conversations between him and RC and GB. The recordings were approximately 2 minutes 30 seconds in length and went over basic details of the relevant mortgage with the Borrowers to “verify” them.

    55. C. Complaints to Mortgage Smart

  55. Mortgage Smart received at least 4 complaints regarding the conduct of Ranjit Dhillon and Almusri. These complaints concerned the MC, JG, JC, and RC/DC Mortgages and were dated April 7, June 6, June 7, and June 21, 2022, respectively.

  56. Mortgage Smart did not take sufficient, and in most cases, any steps to resolve the complaints. Mortgage Smart was unable to provide to FSRA any evidence of an investigation or disciplinary measure taken in respect of the complaints.

  57. Mortgage Smart did not take any steps to inform FSRA about the misconduct alleged in the complaints.

    58. D. Operations of Mortgage Smart

    Day to Day Management

  58. Ranjit Dhillon, in his interview with FSRA, stated that he was primarily responsible for running the day-to-day operations of Mortgage Smart. This included the hiring of new mortgage agents, running the office, and preparing and filing regulatory compliance documents, including Mortgage Smart’s 2021 and 2022 Annual Information Returns (“AIRs”).

  59. Kamal Dhillon had reduced her involvement in the operations of Mortgage Smart since 2019 and had limited oversight on the business conducted by Mortgage Smart’s brokers and agents, including Ranjit Dhillon and Almusri, even though she continued to be the principal broker and was a director.

  60. Ranjit Dhillon admitted to “co-brokering” mortgages with MH from the first week of June 2021 prior to her being licensed on June 29, 2021. MH’s actions included collecting documents from clients, including personal documents and/or other information, and negotiating, arranging or attempting to arrange mortgages for them.

    61. Record Keeping and Policies and Procedures

  61. Ranjit Dhillon was contacted by ST about issues relating to the MC Mortgage on or before February 25, 2022. In March 2022 Mortgage Smart received requests for documentation relating to the MC and JC Mortgages from a lawyer representing MC and JC. Ranjit Dhillon stated that between March and September 2022 he deleted all of the emails in Mortgage Smart’s primary email account - “r_dhillon@centum.ca”. The email account had been active for 13 years. Kamal Dhillon stated that all emails from her work account were forwarded to this email account. The deleted emails included emails concerning the mortgages brokered for the Borrowers.

  62. FSRA’s investigation revealed that Mortgage Smart brokered at least 43 mortgages in which CCI was the lender. Upon being compelled, Mortgage Smart was able to eventually provide files relating to 37 of these mortgages. Mortgage Smart has been unable to locate and produce at least 6 mortgage files in which CCI was the lender.

  63. Mortgage Smart did not establish sufficient policies and procedures dealing with the maintenance and retention of records and identification of conflicts of interest.

  64. Mortgage Smart did not comply with the complaints process as provided in their policies and procedures when dealing with the complaints from MC, JC, JG, and RC/DC.

    65. E. False or Misleading Information to FSRA

  65. On March 31, 2022, Ranjit Dhillon filed an Annual Information Return for 2021 on behalf of Mortgage Smart with FSRA (the “2021 AIR”). The form requires that it be completed by a principal broker. The certification section of the form does not include Kamal Dhillon’s name.

  66. The 2021 AIR falsely stated that during that year Mortgage Smart brokered 10 mortgages in which CCI was the lender, with a total value of approximately $3,180,000. The correct figures were 37 mortgages with a total value of approximately $10,390,000. Ranjit Dhillon stated that the aforesaid false information was provided in error.

  67. Kamal Dhillon in her licence renewal application to FSRA dated March 16, 2023 (“KD Renewal Application”) falsely stated that she was not a defendant in any civil proceedings. In fact, Kamal Dhillon and Mortgage Smart were named as defendants in several civil proceedings, including court file No. CV-22-00684622- 0000, where Kamal Dhillon and Mortgage Smart have filed a Notice of Intent to Defend on September 14, 2022.

  68. Almusri, in interviews with FSRA on June 14 and August 3, 2023,

    1. Initially falsely stated that he was not providing services to CCC while working as a mortgage agent at Mortgage Smart. He admitted to doing so during the course of the interviews; and

    2. Initially falsely stated he never met clients in person while working as a mortgage agent at Mortgage Smart. He admitted to doing so during the course of the interviews.


    69. III. CONTRAVENTIONS OR FAILURES TO COMPLY WITH THE ACT

    A. Failure to take Reasonable Steps to Ensure Suitability

  69. Subsection 24(1) of Ontario Regulation 188/08 provides that a brokerage shall take reasonable steps to ensure that any mortgage or investment in a mortgage that it presents for the consideration of a borrower is suitable for the borrower having regard to the needs and circumstances of the borrower.

  70. Section 3 of Ontario Regulation 187/08 provides that a mortgage broker or agent shall not do or omit to do anything that might reasonably be expected to result in the brokerage on whose behalf he or she is authorized to deal or trade in mortgages to contravene or fail to comply with a requirement established under the Act. This provision is also relevant to Sections III.B. and III.C. of this proposal below.

  71. Ranjit Dhillon and Almusri, while dealing in mortgages on behalf of Mortgage Smart, failed to take sufficient steps to ensure that the mortgages they arranged were suitable for the Borrowers. Several suitability concerns were apparent from the mortgage documents:

    1. The age and the physical and mental condition of the Borrowers were not taken into account. Ranjit Dhillon, Almusri, and Mortgage Smart took no steps to collect relevant information from Borrowers in this respect;

    2. The Borrowers’ residential properties, which were also their main assets, were put forward as security for the mortgages thereby compounding the negative consequences of default;

    3. The payments on mortgages exceeded or came close to exceeding the monthly incomes of the Borrowers, all of whom were pensioners and on fixed incomes;

    4. All of the mortgages were for 1-year terms after which the entire mortgage amount would become payable. It was evident from the income and assets stated in the mortgage applications prepared by Ranjit Dhillon and Almusri that it was very unlikely that the Borrowers could repay the mortgage amount at the end of the term;

    5. The interest rate on the BB, JC, and JG mortgages was an exorbitant 25%, with APRs factoring in borrowing costs exceeding 30%;

    6. A significant portion of the mortgage proceeds were deducted at closing as prepayment of interest or “interest reserve”;

    7. The cost of borrowing as stated in the mortgage disclosure was as high as 32.3% of the total mortgage value. Despite this Ranjit Dhillon and Almusri did not provide any alternative financing options to the Borrowers; and

    8. The mortgage amounts arranged by Almusri and Ranjit Dhillon far exceeded the amount required to discharge the NOSIs and previous mortgages.

  72. The Director is satisfied that Mortgage Smart contravened subsection 24(1) of Ontario Regulation 188/08 by failing to take reasonable steps to ensure that the mortgages arranged for the Borrowers were suitable to their needs and circumstances.

  73. The Director is also satisfied that Ranjit Dhillon and Almusri contravened section 3 of Ontario Regulation 187/08 by failing to take reasonable steps to ensure that the mortgages they presented to the Borrowers were suitable for them, causing Mortgage Smart to contravene subsection 24(1) of Ontario Regulation 188/08.

    74. B. Failure to Disclose Material Risks

  74. Subsection 25(1) of Ontario Regulation 188/08 provides that a brokerage shall disclose in writing to a borrower the material risks of each mortgage or investment in a mortgage that the brokerage presents for the consideration of the borrower.

  75. Section 31 of Ontario Regulation 188/08 provides that a written disclosure must be expressed in plain language that is clear and concise and it must be presented in a manner that is logical and is likely to bring to the attention of the borrower the information that is required to be conveyed.

  76. The written disclosure provided by Ranjit Dhillon and Almusri to the Borrowers, while acting on behalf of Mortgage Smart, simply stated “risk of falling into arrears, default and foreclosure, prepayment penalties etc” as the risks associated with the mortgages arranged for the Borrowers.

  77. The written disclosure prepared by Ranjit Dhillon and Almusri did not identify and disclose any risks based on the age, income, and physical and mental condition of the Borrowers, and the Borrowers’ residential properties being put forward as security for each of the transactions.

  78. Furthermore, Ranjit Dhillon and Mortgage Smart ought to have specifically disclosed the relationship between CCC and CCI and that CCC was involved in certain steps relating to the mortgage brokering process, such as facilitating and paying for appraisals. CCC referrals comprised a large portion of Mortgage Smart’s business.

  79. Detailed disclosure was especially important in the relevant circumstances which involved short-term high interest private mortgages being offered to fixed income pensioners most of whom had limited knowledge of, or capacity to understand, such transactions. The Borrowers appear not to have understood the terms and the implications of the mortgage, or in some cases that they had a mortgage at all.

  80. The Director is satisfied that Mortgage Smart contravened subsection 25(1) of Ontario Regulation 188/08 by failing to disclose in writing to the Borrowers all the material risks associated with the mortgages brokered for them.

  81. The Director is also satisfied that Ranjit Dhillon and Almusri contravened section 3 of Ontario Regulation 187/08 by failing to disclose the material risks and causing Mortgage Smart to contravene subsection 25(1) of Ontario Regulation 188/08.

    82. C. Failure to Disclose Conflicts of Interest

  82. Subsection 27(1) of Ontario Regulation 188/08 provides that a brokerage shall disclose in writing to a borrower any conflict of interest or potential conflict of interest that the brokerage or any broker or agent authorized to deal or trade in mortgages on its behalf may have in connection with a mortgage or a trade in a mortgage that the brokerage presents for the consideration of the borrower.

  83. Subsection 27(2) of Ontario Regulation 188/08 provides that a brokerage shall obtain the written acknowledgement of the borrower with respect to such disclosure.

  84. Neither Ranjit Dhillon, Almusri, nor Mortgage Smart disclosed Mortgage Smart’s referral arrangement with CCC to the Borrowers.

  85. CCC had NOSIs registered on all of the Borrowers’ Properties. The NOSIs were discharged using the mortgage proceeds. CCC also funded the appraisal for GB Property. Also, CCC was related to CCI (with each having the same sole officer and director) which acted as the lender for BB, JG, and JC Mortgages. As stated above, CCC referrals comprised a large portion of Mortgage Smart’s business and CCI funded the highest number of Mortgage Smart brokered mortgages in 2021.

  86. Further, Mortgage Smart and Ranjit Dhillon were aware that Almusri was associated with and working for CCC at or around the time he was brokering mortgages for RC/DC, MC, and GB. Neither Mortgage Smart, Ranjit Dhillon nor Almusri disclosed Almusri’s relationship with CCC and the potential conflicts of interest that may arise from it.

  87. The Director is satisfied that Mortgage Smart contravened subsection 27(1) of Ontario Regulation 188/08 by failing to disclose Mortgage Smart’s and Almusri’s relationships with CCC to the Borrowers.

  88. The Director is also satisfied that Ranjit Dhillon and Almusri contravened section 3 of Ontario Regulation 187/08 by failing to disclose conflicts of interest and causing Mortgage Smart to contravene subsection 27(1) of Ontario Regulation 188/08.

    89. D. Giving False or Deceptive Information when Dealing in Mortgages

  89. Subsection 43(1) of the Act provides that no mortgage brokerage 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 carrying on the business of dealing in mortgages in Ontario or the business of trading in mortgages in Ontario.

  90. Subsection 43(2) of the Act provides that 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.

  91. Such conduct is prohibited whether or not the brokerage, broker, or agent is aware that the information is false or deceptive.

  92. As described above, the application forms for the JC and JG Mortgages submitted by Ranjit Dhillon and the RC/DC, MC, and GB Mortgages prepared by Almusri contained false and/or deceptive information. The application forms for the JC, JG, and BB Mortgages also contained alterations which were applied after the concerned Borrower signed the application.

  93. Further, as described above, Almusri deceived RC/DC into taking the RC/DC Mortgage by making false representations as to the nature of the transactions and its related documents.

  94. In view of the above, the Director is satisfied that Ranjit Dhillon and Almusri gave false or deceptive information to lenders and borrowers when dealing in mortgages contrary to subsection 43(2) of the Act, repeatedly, in respect of each of the aforesaid mortgages.

  95. The Director is also satisfied that Mortgage Smart, through Ranjit Dhillon and Almusri, gave false or deceptive information to lenders and borrowers when dealing in mortgages contrary to subsection 43(1) of the Act, repeatedly, in respect of each of the aforesaid mortgages.

    96. E. Giving False or Misleading Information to FSRA

  96. Subsection 45(1) of the Act provides that no person or entity shall give false or misleading information to the Chief Executive Officer or a person designated by the Chief Executive Officer in respect of any matter related to this Act or its regulations.

  97. Subsection 45(2) of the Act provides that no person or entity shall include false or misleading information in any document required to be created, stored, or given to the Chief Executive Officer of FSRA under the Act.

  98. The Director is satisfied that Almusri contravened subsection 45(1) of the Act by giving false and misleading information in his interviews with FSRA on June 14 and August 3, 2023.

  99. The Director is satisfied that Mortgage Smart and Ranjit Dhillon contravened subsection 45(2) of the Act by including false information with respect to Mortgage Smart’s business involving CCI in Mortgage Smart’s 2021 AIR.

  100. The Director is also satisfied that Kamal Dhillon contravened section 45(2) of the Act by providing false information in her licence renewal application.

    101. F. Failure to Address Complaints and Report Misconduct to FSRA

  101. Subsection 9(1) of Ontario Regulation 188/08 provides that if a person makes a complaint to the brokerage in writing about the mortgage business activities of the brokerage or of any broker or agent authorized to deal or trade in mortgages on its behalf, the brokerage shall give the person a written response to the complaint setting out the brokerage’s proposed resolution of the complaint.

  102. Subsection 43(3) of Ontario Regulation 188/08 provides that a brokerage shall immediately notify the Chief Executive Officer if the brokerage believes that there may be reasonable grounds upon which the Chief Executive Officer could determine that a broker or agent is not suitable to be licensed under the Act.

  103. As described above, Mortgage Smart received at least 4 complaints with respect to the conduct of Ranjit Dhillon and Almusri related to the brokering of the MC, JC, JG, and RC/DC Mortgages. The allegations in the complaints provided reasonable grounds based on which FSRA could have determined that Ranjit Dhillon and Almusri were not suitable to be licensed under the Act.

  104. Mortgage Smart did not comply with its own policies and procedures, nor did it make any reasonable efforts to resolve the said complaints and did not inform FSRA of Ranjit Dhillon and Almusri’s misconduct.

  105. In view of the above, the Director has determined that Mortgage Smart contravened subsections 9(1) and 43(3) of Ontario Regulation 188/08.

    106. G. Failure to Comply with Record Keeping Requirements

  106. Subsection 48(1) of Ontario Regulation 188/08 provides that a brokerage shall retain all records that relate to a mortgage for at least six years after the expiry of the term of the mortgage or renewal or other expiry of the mortgage transaction.

  107. The Director is satisfied that Mortgage Smart contravened subsection 48(1) of Ontario Regulation 188/08 by failing to maintain email records pertaining to the Borrower’s mortgages for the requisite six years.

  108. The Director is also satisfied that Ranjit Dhillon contravened section 3 of Ontario Regulation 187/08 by deleting records relating to the Borrowers’ mortgages thereby causing Mortgage Smart to contravene subsection 48(1) of Ontario Regulation 188/08.

    109. H. Failure to Carry out Principal Broker Duties

  109. Subsection 2(1) of Ontario Regulation 410/07 provides that a principal broker of a brokerage shall take reasonable steps to ensure that the brokerage, and each broker and agent authorized to deal or trade in mortgages on its behalf, complies with every requirement established under the Act.

  110. Subsection 2(2) of Ontario Regulation 410/07 provides that a principal broker shall ensure that the brokerage takes reasonable steps to deal with any contravention of a requirement established under the Act by the brokerage or by a broker or agent authorized to deal or trade in mortgages on its behalf.

  111. Clause (a) of subsection 3(1) of Ontario Regulation 410/07 provides that a principal broker shall review the policies and procedures of the brokerage to determine whether they are reasonably designed to ensure the compliance of their brokerage and its brokers and agents comply with the Act.

  112. Kamal Dhillon, as the principal broker of Mortgage Smart, failed to take reasonable steps to ensure that Ranjit Dhillon and Almusri complied with the Act and its regulations. She also failed to take any steps to deal with the numerous contraventions by Ranjit Dhillon, Almusri, and Mortgage Smart, even after receiving complaints.

  113. In view of the above, the Director is satisfied that Kamal Dhillon contravened subsection 2(1) and 2(2) of Ontario Regulation 410/07.

  114. Furthermore, the Director is satisfied that Kamal Dhillon contravened clause (a) of subsection 3(1) of Ontario Regulation 410/07 by failing to review and ensure that Mortgage Smart had adequate policies and procedures dealing with the maintenance and retention of records and identification of conflicts of interest.

    115. IV. GROUNDS FOR REVOCATION OR REFUSAL

    Relevant Provisions

  115. Section 16(4) of the Act states that the Chief Executive Officer shall renew the licence of an applicant who satisfies the prescribed requirements for renewal of the licence unless the Chief Executive Officer believes, on reasonable grounds, that the applicant is not suitable to be licensed having regard to such circumstances as may be prescribed and such other matters as the Chief Executive Officer considers appropriate.

  116. Section 19(1) of the Act states that the Chief Executive Officer may, by order, revoke a licence in any of the circumstances in which he or she is authorized to suspend a licence.

  117. According to section 18(1) of the Act, such circumstances in a licence may be suspended include:

    1. if the Chief Executive Officer believes, on reasonable grounds, that the licensee is no longer suitable to be licensed having regard to the circumstances, if any, prescribed for the purposes of subsection 14(1) or 16(4) of the Act, as the case may be, and such other matters as the Chief Executive Officer considers appropriate; or

    2. if the licensee contravenes or fails to comply with a requirement established under this Act.

  118. According to section 1(2) of Ontario Regulation 408/07, the circumstances that the Chief Executive Officer must consider when determining that a mortgage brokerage is not suitable to be licensed include:

    1. Whether the past conduct of any director or officer of the corporation affords reasonable grounds for belief that the business of the corporation will not be carried on in accordance with the law and with integrity and honesty.

    2. Whether a director or officer of the corporation has made a false statement or has provided false information to the Chief Executive Officer with respect to the application for a licence.


  119. Section 10 of Ontario Regulation 409/07 under the Act states that in determining whether an individual is not suitable to be licensed as a mortgage broker or agent, the Chief Executive Officer is required by subsections 14(1) and 16(4) of the Act to have regard to the following prescribed circumstances:

    1. Whether the individual’s past conduct affords reasonable grounds for belief that he or she will not deal or trade in mortgages in accordance with the law and with integrity and honesty.

    2. Whether the individual is carrying on activities that contravene or will contravene the Act or the regulations if he or she is licensed.

    3. Whether the individual has made a false statement or has provided false information to the Chief Executive Officer with respect to the application for the licence.


    120. Refusal to Renew Ranjit Dhillon’s Mortgage Broker Licence and Almusri’s Mortgage Agent Licence

  120. In view of Ranjit Dhillon and Almusri’s numerous contraventions of the Act and its regulations outlined above, the Director has reasonable grounds to believe that Ranjit Dhillon and Almusri are not suitable to deal or trade in mortgages.

  121. As described in sections III.A. to III.E. and III.G. of this proposal, Ranjit Dhillon and Almusri, while brokering unsuitable mortgages for vulnerable senior citizens, deliberately and repeatedly contravened the Act and Ontario Regulations 187/08.

  122. Ranjit Dhillon and Almusri’s dishonest conduct and repeated failures to comply with the Act and its regulations were relatively recent and were wholly related to their activities as licensees under the Act.

  123. Therefore, Ranjit Dhillon and Almusri’s past conduct affords reasonable grounds for belief that they will not deal or trade in mortgages in accordance with the law and with integrity and honesty.

    124. Revocation of Kamal Dhillon’s Mortgage Broker Licence

  124. The Director has determined that Kamal Dhillon is no longer suitable to be licensed as a mortgage broker under the Act and that her licence should be revoked on account of her failure to comply with requirements established under the Act.

  125. As described in section III.H. of this proposal, Kamal Dhillon, as the principal broker of Mortgage Smart, failed to fulfill the duties stipulated in Ontario Regulation 410/07. Further, Kamal Dhillon also contravened the Act by providing false information in her licence renewal application.

  126. Finally, the seriousness of Kamal Dhillon’s misconduct is compounded by the fact she was the principal broker of Mortgage Smart and had a heightened responsibility regarding the regulatory requirement of the Act and its regulations. As noted above, section 2(1) of Ontario Regulation 410/07 requires Kamal Dhillon to take reasonable steps to ensure that Mortgage Smart and each broker and agent authorized to deal or trade in mortgages on its behalf comply with every requirement established under the Act.

  127. In particular, Kamal Dhillon’s complete failure to supervise the activities of Ranjit Dhillon and Almusri resulted in and/or allowed the repeated contraventions of the Act and its regulations by Ranjit Dhillon, Almusri, and Mortgage Smart and caused harm to vulnerable senior citizens.

  128. Further, by providing false information in her renewal application, Kamal Dhillon undermined the FSRA licensing process and public confidence in the mortgage sector. FSRA requires truthful and complete disclosure by applicants and licensees to effectively regulate the mortgage brokering sector. FSRA relies upon the information provided by applicants to assess licensing applications.

    129. Revocation of Mortgage Smart’s Mortgage Brokerage Licence

  129. The Director has determined that Mortgage Smart is no longer suitable to be licensed as a mortgage broker under the Act and that its licence should be revoked.

  130. Firstly, as outlined in Sections III.A. to III.G. of this proposal, Mortgage Smart, through Ranjit Dhillon and Almusri as well as solely in its own capacity, repeatedly contravened the Act and its regulations.

  131. Secondly, Kamal Dhillon, the owner and sole director of Mortgage Smart, failed to fulfill her duties as the principal broker of Mortgage Smart and thereby contravened provisions of Ontario Regulation 410/07. She abdicated her responsibilities as a principal broker and let Ranjit Dhillon handle the day-to-day operations of Mortgage Smart with little or no supervision. Also, by declaring that she was not a defendant in any civil proceedings, Kamal Dhillon made a false statement in her licence renewal application.

  132. Kamal Dhillon’s contraventions resulted in and/or allowed the commission of numerous contraventions of the Act and its regulations by Ranjit Dhillon, Almusri, and Mortgage Smart. Therefore, Kamal Dhillon’s past conduct affords reasonable grounds for the belief that the business of Mortgage Smart will not be carried on in accordance with the law and with integrity and honesty.

    133. V. GROUNDS FOR IMPOSING ADMINISTRATIVE PENALTIES

  133. The Director is satisfied that imposing administrative penalties on Ranjit Dhillon, Almusri, Kamal Dhillon, and Mortgage Smart under section 39(1) 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 from deriving, directly or indirectly, any economic benefit as a result of contravening or failing to comply with a requirement established under this Act.


  134. In determining the amount of the administrative penalty below, the Director has considered the following criteria as required by section 3(1) 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.


    135. Administrative Penalties to be imposed on Ranjit Dhillon

  135. The Director is satisfied that 13 administrative penalties totaling $80,000 should be imposed on Ranjit Dhillon,

    1. 3 administrative penalties of $5,000 each, totaling $15,000, for contravening section 3 of Ontario Regulation 187/08 by causing Mortgage Smart to contravene subsection 24(1) of Ontario Regulation 188/08 by failing to take reasonable steps to ensure that mortgages arranged for BB, JC, and JG were suitable to their needs and circumstances;

    2. 3 administrative penalties of $5,000 each, totaling $15,000, for contravening section 3 of Ontario Regulation 187/08 by causing Mortgage Smart to contravene subsection 25(1) of Ontario Regulation 188/08 by failing to disclose in writing to BB, JC, and JG all the material risks associated with the mortgages brokered for them;

    3. 3 administrative penalties of $5,000 each, totaling $15,000, for contravening section 3 of Ontario Regulation 187/08 by causing Mortgage Smart to contravene subsection 27(1) of Ontario Regulation 188/08 by failing to disclose Mortgage Smart’s and Almusri’s relationships with CCC to BB, JC, and JG;

    4. 2 administrative penalties of $10,000 each, totaling $20,000, for contravening subsection 43(2) of the Act by providing false or deceptive information in the application forms for the JC and JG Mortgages;

    5. An administrative penalty of $5,000 for contravening subsection 45(2) of the Act by providing false information to FSRA by including false information with respect to Mortgage Smart’s business involving CCI in Mortgage Smart’s 2021 AIR; and

    6. An administrative penalty of $10,000 for contravening section 3 of Ontario Regulation 187/08 by deleting records relating to the Borrowers’ mortgages thereby causing Mortgage Smart to contravene subsection 48(1) of Ontario Regulation 188/08.


    136. Administrative Penalties to be imposed on Almusri

  136. The Director is satisfied that 13 administrative penalties totaling $77,000 should be imposed on Almusri,

    1. 3 administrative penalties of $5,000 each, totaling $15,000, for contravening section 3 of Ontario Regulation 187/08 by causing Mortgage Smart to contravene subsection 24(1) of Ontario Regulation 188/08 by failing to take reasonable steps to ensure that mortgages arranged for RC/DC, MC, and GB were suitable to their needs and circumstances;

    2. 3 administrative penalties of $5,000 each, totaling $15,000, for contravening section 3 of Ontario Regulation 187/08 by causing Mortgage Smart to contravene subsection 25(1) of Ontario Regulation 188/08 by failing to disclose in writing to RC/DC, MC, and GB all the material risks associated with the mortgages brokered for them;

    3. 3 administrative penalties of $5,000 each, totaling $15,000, for contravening section 3 of Ontario Regulation 187/08 by causing Mortgage Smart to contravene subsection 27(1) of Ontario Regulation 188/08 by failing to disclose Mortgage Smart’s and Almusri’s relationships with CCC to RC/DC, MC, and GB;

    4. 3 administrative penalties of $10,000 each, totaling $30,000, for contravening subsection 43(2) of the Act by providing false or deceptive information in the application forms for the RC/DC, MC, and GB Mortgages; and

    5. An administrative penalty in the amount of $2,000 for contravening subsection 45(1) of the Act by providing false information to FSRA in interviews conducted by FSRA.


    137. Administrative Penalties to be imposed on Kamal Dhillon

  137. The Director is satisfied that 3 administrative penalties totaling $22,500 should be imposed on Kamal Dhillon,

    1. An administrative penalty in the amount of $10,000 for contravening subsection 2(1) of Ontario Regulation 410/07 by failing to take reasonable steps to ensure that Mortgage Smart, Ranjit Dhillon, and Almusri complied with every requirement established under the Act;

    2. An administrative penalty in the amount of $7,500 for contravening subsection 3(1) of Ontario Regulation 410/07 by failing to review the policies and procedures of Mortgage Smart to determine whether they are reasonably designed to ensure the compliance of Mortgage Smart and its brokers and agents comply with the Act; and

    3. An administrative penalty in the amount of $5,000 for contravening subsection 45(2) of the Act by providing false information to FSRA by including false information in her renewal application.


    138. Administrative Penalties to be imposed on Mortgage Smart

  138. The Director is satisfied that 29 administrative penalties totaling $170,000 should be imposed on Mortgage Smart;

    1. 6 administrative penalties of $5,000 each, totaling $30,000, for contravening subsection 24(1) of Ontario Regulation 188/08 by failing to take reasonable steps to ensure that mortgages arranged for the Borrowers were suitable to their needs and circumstances;

    2. 6 administrative penalties of $5,000 each, totaling $30,000 for contravening subsection 25(1) of Ontario Regulation 188/08 by failing to disclose in writing to the Borrowers all the material risks associated with the mortgages brokered for them;

    3. 6 administrative penalties of $5,000 each, totaling $30,000, for contravening subsection 27(1) of Ontario Regulation 188/08 by failing to disclose Mortgage Smart’s and Almusri’s relationships with CCC to the Borrowers;

    4. 5 administrative penalties of $10,000 each, totaling $50,000 for contravening subsection 43(1) of the Act by providing false or deceptive information in the application forms for the JC, JG, MC, RC/DC, and GB mortgages;

    5. An administrative penalty in the amount of $5,000 for contravening subsection 45(2) of the Act by including false information with respect to Mortgage Smart’s business involving CCI in Mortgage Smart’s 2021 AIR;

    6. 4 administrative penalties of $2,500 each, totaling $10,000, for contravening subsection 9(1) of Ontario Regulation 188/08 by failing to address complaints from MC, JG, JC, and RC/DC in the manner required by the subsection; and

    7. An administrative penalty in the amount of $15,000 for contravening subsection 48(1) of the Ontario 188/08 by failing to maintain email records relating to the Borrower’s mortgages for a period of six years.


  139. In determining the above stated amounts of administrative penalties, the Director has considered the criteria listed in section 3(1) of Ontario Regulation 192/08.

  140. In respect of the first criterion, the Director is satisfied that Mortgage Smart’s, Ranjit Dhillon’s, and Almusri’s misconduct was intentional.

    1. Although the licensees were aware of the personal and financial circumstances of the Borrowers, they knowingly and intentionally did not take reasonable steps to ensure that the Borrowers’ mortgages were suitable;

    2. Furthermore, Mortgage Smart, Ranjit Dhillon, and Almusri intentionally failed to disclose conflicts of interest or material risks which they were aware of or ought to have been aware of to the Borrowers. They also intentionally entered false information in mortgage application forms without taking sufficient steps to confirm the information with the Borrowers; and

    3. Mortgage Smart knowingly and intentionally did not take steps to reasonably address complaints made by MC, JG, JC, and RC/DC, and intentionally failed to maintain email records relating to the Borrower’s mortgages. The email records were deleted after Ranjit Dhillon was contacted by ST about issues with the MC Mortgage and Mortgage Smart received requests to provide documentation relating to the MC and JC Mortgages.



  141. Kamal Dhillon knowingly and intentionally abdicated her responsibilities as a principal broker and failed to supervise the activities of Mortgage Smart, Ranjit Dhillon, and Almusri. Furthermore, she improperly delegated her principal broker responsibilities to Ranjit Dhillon with little or no supervision.

  142. In addition to the above, Kamal Dhillon intentionally provided false information in their renewal applications to FSRA with respect to legal proceedings initiated against her. Ranjit Dhillon and Mortgage Smart intentionally provided false information to FSRA in Mortgage Smart’s 2021 AIR.

  143. The forms for the 2021 AIR and the licensing renewal application contain a caution about the provision of false information and declaration as to the truthfulness of the contents. The provision of false information, despite these reminders and safeguards, suggests intentional conduct.

  144. All of the above licensees exhibited a pattern of intentional misconduct which affected multiple vulnerable consumers, and which occurred over a period of 9 months.

  145. In respect of the second criterion, the Director is satisfied that Mortgage Smart’s, Ranjit Dhillon’s, Almusri’s, and Kamal Dhillon’s pattern of intentional misconduct has caused or has the potential to cause significant harm to the Borrowers.

  146. All of the Borrowers were vulnerable senior citizens on fixed incomes. The mortgaged properties were their primary residences. The severe consequences of default, which may include the Borrowers losing possession of their primary residence, make the mortgage terms especially unsuitable and the misconduct related to the mortgages particularly egregious.

  147. JG has defaulted on the JG Mortgage and is defending a foreclosure proceeding commenced by CCI.

  148. Kamal Dhillon’s provision of false information to FSRA in her Renewal Application and Ranjit Dhillon’s and Mortgage Smart’s provision of false information in Mortgage Smart’s 2021 AIR had the potential to harm FSRA’s ability to properly assess their suitability for continued licensing, thereby causing risk to consumers and other industry participants.

  149. Mortgage Smart’s failure to maintain email records relating to the Borrower’s mortgages, which Ranjit Dhillon deleted, harmed FSRA’s ability to effectively regulate the sector and examine the Borrower’s mortgages.

  150. Furthermore, Mortgage Smart’s, Ranjit Dhillon’s, Kamal Dhillon’s, and Almusri’s misconduct as persons and entities licensed and regulated under the Act, has the potential to harm public confidence in the regulatory regime established by the Act and its regulations.

  151. In respect of the third criterion, the Director is unaware of any steps taken by Ranjit Dhillon, Almusri, Kamal Dhillon, and Mortgage Smart to remedy the contraventions described in this proposal.

  152. In respect of the fourth criterion, the Director is satisfied that Mortgage Smart, Ranjit Dhillon, Almusri, and Kamal Dhillon derived substantial direct economic benefit from the contraventions described in this proposal. Mortgage Smart received a total of $48,925 in the form of brokerage fees from lenders for arranging mortgages for the Borrowers. Kamal Dhillon was owner and the sole director of Mortgage Smart. Ranjit Dhillon, her spouse, was running the day-to-day operations of Mortgage Smart and had ready access to its funds, which he used as and when he required.

  153. Almusri received $4,655 as commissions for arranging mortgages for GB, MC, and RC/DC.

  154. Furthermore, Mortgage Smart also derived substantial indirect economic benefits from the contraventions as it allowed Mortgage Smart and Ranjit Dhillon to develop a profitable business relationship with CCI. As per information made available to FSRA, in or around 2021-2022, Mortgage Smart received brokerage fees amounting to $308,350 on 43 mortgage deals where CCI was the lender.

  155. In respect of the fifth criterion, the Director is unaware of any further contraventions or failures to comply in the preceding five years by Mortgage Smart, Ranjit Dhillon, Kamal Dhillon, and Almusri other than those discussed in this Notice of Proposal.

  156. The Director is satisfied, having regarded all the circumstances, that the proposed amount of the penalty is not punitive in nature, and the amount is consistent with one or both purposes of section 38 of the Act.

  157. Such further and other reasons as may come to the attention of the Director.

  158. The Director is satisfied that there are sufficient grounds to refuse Ranjit Dhillon’s and Almusri’s applications to renew their licenses, revoke Mortgage Smart’s and Kamal Dhillon’s licences, and impose administrative penalties in the above stated amounts on Mortgage Smart, Ranjit Dhillon, Almusri, and Kamal Dhillon.

DATED at Toronto, Ontario, August 22, 2023

Original signed by

Elissa Sinha
Director, Litigation and Enforcement

By delegated authority from the Chief Executive Officer

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