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 35, 38, and 39;

AND IN THE MATTER OF Kim Thanh Do, Rebecca Thien Kim Nguyen Do, Gyula “George” “Julien” Zambok, 5015977 Ontario Inc. “501 Ontario” (formerly GTA Home Protection Plans), Jordan Ovejas, Bruce Rene Kotis (also doing business as Myriad Mortgage), 2382314 Ontario Inc. operating as Mortgage Bridge Canada, and Kasturi Chatterjee.


NOTICE OF PROPOSAL TO IMPOSE ADMINISTRATIVE PENALTIES AND TO IMPOSE A COMPLIANCE ORDER

TO: Kim Thanh Do

TO: Rebecca Thien Kim Nguyen Do

TO: Gyula “George” “Julien” Zambok

TO: 5015977 Ontario Inc. (formerly GTA Home Protection Plans Inc.)

TO: Jordan Ovejas

TO:
Bruce Rene Kotis
Also doing business as Myriad Mortgage

TO: 2382314 Ontario Inc. o/a Mortgage Bridge Canada

TO:
Kasturi Chatterjee
Principal Broker, Mortgage Bridge Canada

TAKE NOTICE THAT pursuant to section 39 of the Act, and by delegated authority from the Chief Executive Officer, the Director, Litigation and Enforcement is proposing to impose administrative penalties as follows. The maximum administrative penalties were increased effective February 1, 2022.

  1. Six (6) administrative penalties against Kim Thanh Do in the total amount of $140,000 for the following contraventions:
    1. An administrative penalty of $30,000 for, after February 1, 2022, dealing in mortgages in Ontario for remuneration without acting on behalf of a mortgage brokerage, contrary to section 2(3) of the Act, and receiving remuneration for dealing in mortgages from a person other than the brokerage on whose behalf she is authorized to deal in mortgages, contrary to section 4(1) of O. Reg. 187/08;
    2. Two (2) administrative penalties totaling $40,000 for doing or omitting to do things that might reasonably be expected to result in the brokerage on whose behalf she was authorized to deal in mortgages to contravene or fail to comply with a requirement established under the Act, contrary to section 3 of O. Reg. 187/08:
      1. An administrative penalty of $10,000 for acts or omissions occurring before February 1, 2022; and
      2. An administrative penalty of $30,000 for acts or omissions occurring on or after February 1, 2022.
    3. Two (2) administrative penalties totaling $50,000 for acting, doing, or omitting to do things in circumstances where she ought to have known that by acting, doing the thing or omitting to do the thing, she was being used by a lender or any other person to facilitate dishonesty, fraud, or illegal conduct, contrary to section 3.1 of O. Reg. 187/08:
      1. An administrative penalty of $10,000 for acts or omissions occurring before February 1, 2022; and
      2. An administrative penalty of $40,000 for acts or omissions occurring on or after February 1, 2022.
    4. An administrative penalty of $20,000 for failing to provide documents and to provide information under oath after February 1, 2022, contrary to a requirement established under section 34 of the Act.
  2. Three (3) administrative penalties in the total amount of $30,000 against Rebecca Thien Kim Nguyen Do for the following contraventions:
    1. An administrative penalty of $10,000 for doing or omitting to do things that might reasonably be expected to result in the brokerage on whose behalf she was authorized to deal in mortgages to contravene or fail to comply with a requirement established under the Act, before and after February 1, 2022, contrary to section 3 of O. Reg. 187/08; and
    2. Two (2) administrative penalties totaling $20,000 for acting, doing, or omitting to do things in circumstances where she ought to have known that by acting, doing the thing or omitting to do the thing, she was being used by a lender or any other person to facilitate dishonesty, fraud, or illegal conduct, contrary to section 3.1 of O. Reg. 187/08:
      1. An administrative penalty of $10,000 for acts or omissions occurring before February 1, 2022; and
      2. An administrative penalty of $10,000 for acts or omissions occurring on or after February 1, 2022.
  3. Three (3) administrative penalties against Gyula “George” “Julien” Zambok in the total amount of $130,000 for the following contraventions:
    1. Two (2) administrative penalties totaling $110,000 for dealing in mortgages for remuneration, either directly or indirectly, without having a mortgage agent or broker licence and without being exempted from the requirement to have such a licence, pursuant to section 2(3) of the Act:
      1. An administrative penalty of $10,000 for mortgage dealing activities occurring before February 1, 2022; and
      2. An administrative penalty of $100,000 for mortgage dealing activities occurring on or after February 1, 2022.
    2. An administrative penalty of $20,000 for failing to provide documents and to provide information under oath after February 1, 2022, contrary to a requirement established under section 34 of the Act.
  4. Two (2) administrative penalties in the total amount of $50,000 against 5015977 Ontario Inc. for the following contraventions:
    1. An administrative penalty of $30,000 for carrying on business as a mortgage lender in Ontario without a brokerage licence or an exemption from the requirement to have such a licence after February 1, 2022, contrary to section 4(2) of the Act; and
    2. An administrative penalty of $20,000 for failing to provide documents after February 1, 2022, contrary to a requirement established under section 34 of the Act.
  5. Two (2) administrative penalties against Jordan Ovejas totaling $80,000 for dealing in mortgages for remuneration, either directly or indirectly, without having a mortgage agent or broker licence and without being exempted from the requirement to have such a licence, pursuant to section 2(3) of the Act:
    1. An administrative penalty of $10,000 for mortgage dealing activities occurring before February 1, 2022; and
    2. An administrative penalty of $70,000 for mortgage dealing activities occurring on or after February 1, 2022.
  6. Two (2) administrative penalties totaling $30,000 against Bruce Kotis for failing to take reasonable steps to ensure that Myriad Mortgage, and each broker and agent authorized to deal or trade in mortgages on its behalf, complied with every requirement established under the Act, contrary to section 2(1) of O. Reg. 410/07:
    1. An administrative penalty of $5,000 for omissions before February 1, 2022; and
    2. An administrative penalty of $25,000 for omissions on or after February 1, 2022.
  7. Five (5) administrative penalties totaling $80,000 against Myriad Mortgage for the following contraventions:
    1. Two (2) administrative penalties totaling $40,000 for failing to take reasonable steps to ensure that the mortgages it presented to borrowers were suitable for them having regard to their needs and circumstances, contrary to section 24(1) of O. Reg. 188/08:
      1. An administrative penalty of $10,000 for omissions before February 1, 2022; and
      2. An administrative penalty of $30,000 for omissions on or after February 1, 2022.
    2. An administrative penalty of $10,000 for arranging a reverse mortgage, without the required written statement signed by a lawyer stating that the lawyer has given the borrower independent legal advice about the mortgage after February 1, 2022, contrary to section 29(1) of O. Reg. 188/08;
    3. An administrative penalty of $10,000 for failing to disclose in writing to borrowers any conflict of interest or potential conflict of interest that the brokerage or any of its brokers or agents may have had in connection with a mortgage that the brokerage presented for the consideration of the borrower or lender, before and after February 1, 2022, contrary to section 27(1) of O. Reg. 188/08; and
    4. An administrative penalty of $20,000 for failing to maintain records as required after February 1, 2022, contrary to section 46(1) and 48(1) of O. Reg. 188/08.
  8. Four (4) administrative penalties against 2382314 Ontario Inc. o/a Mortgage Bridge Canada in the total amount of $60,000:
    1. An administrative penalty of $20,000 for failing to take reasonable steps to ensure that the mortgages it presented to borrowers were suitable for them having regard to their needs and circumstances before February 1, 2022, contrary to section 24(1) of O. Reg. 188/08;
    2. An administrative penalty of $10,000 for arranging a reverse mortgage without the required written statement signed by a lawyer stating that the lawyer has given the borrower independent legal advice about the mortgage before February 1, 2022, contrary to section 29(1) of O. Reg. 188/08;
    3. An administrative penalty of $10,000 for failing to disclose in writing to borrowers any conflict of interest or potential conflict of interest that the brokerage or any of its brokers or agents may have had in connection with a mortgage that the brokerage presented for the consideration of the borrower or lender before February 1, 2022, contrary to section 27(1) of O. Reg. 188/08; and
    4. An administrative penalty of $20,000 for failing to maintain records as required before February 1, 2022, contrary to section 46(1) and 48(1) of O. Reg. 188/08.
  9. An administrative penalty against Kasturi Chatterjee of $10,000 for failing to take reasonable steps to ensure that Mortgage Bridge Canada, and each broker and agent authorized to deal or trade in mortgages on its behalf, complied with every requirement established under the Act before February 1, 2022, contrary to section 2(1) of O. Reg. 410/07.

AND TAKE NOTICE THAT pursuant to section 35 of the Act, and by delegated authority from the Chief Executive Officer, the Director, Litigation and Enforcement is proposing to impose a compliance order on 2382314 Ontario Inc. o/a Mortgage Bridge Canada (licence # 12426) and Kasturi Chatterjee (licence # M14000876).

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 35(3), 35(4), 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 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. TAKE FURTHER NOTICE of the payment requirements in section 4 of Ontario Regulation 192/08, which states that the penalized person or entity shall pay the penalty no later than thirty (30) 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. Kim Thanh Do (“Kim Do”), Rebecca Thien Kim Nguyen Do (“Rebecca Do”), Gyula “Julien” “George” Zambok (“Zambok”), 5015977 Ontario Inc. (“501 Ontario”) and Jordan Ovejas (“Ovejas”) engaged in a course of conduct that targeted and exploited vulnerable consumers using unsuitable, high-fee mortgages.
  2. Zambok and Ovejas were never licensed by FSRA. They attended homes of consumers with notices of security interest (“NOSIs”) previously registered against their properties and offered to remove the NOSIs, typically by paying the company owning the NOSI in full. Zambok and Ovejas solicited consumers to enter into mortgages to fund the NOSI payouts, in addition to consulting fees, and home renovations that Zambok would do through his company. 501 Ontario was the lender on certain mortgages.
  3. Zambok and Ovejas worked with Kim Do and Kim Do’s daughter, Rebecca Do to arrange the mortgages. At the time, Kim Do and Rebecca Do were licensed mortgage agents.
  4. Kim Do and Rebecca Do arranged two to four mortgages for each consumer. The mortgages were complex, expensive, and not suitable for the consumers that were on fixed incomes. Many were unable to afford the mortgages and were harmed.
  5. Kim Do and Rebecca Do’s authorizing brokerages and their principal brokers failed to meet their obligations under the Act and enabled the misconduct to continue. Bruce Kotis (“Kotis”) is the sole proprietor acting as Myriad Mortgage (“Myriad Mortgage”), and was the principal broker of Myriad Mortgage. Kasturi Chatterjee (“Chatterjee”) is the principal broker of 2382314 Ontario Inc., operating as Mortgage Bridge Canada (“Mortgage Bridge Canada”).
  6. These are reasons for the proposal by the Director, Litigation and Enforcement (the “Director”) to impose a compliance order (the “Compliance Order”) and administrative penalties against these individuals and entities (collectively, the “Parties”).

II. BACKGROUND

A. Licensing History

  1. Kim Do was first licensed as a mortgage agent (licence # M08003703) on July 1, 2008. Kim Do’s licence expired on March 31, 2024.
  2. Rebecca Do was first licensed as a mortgage agent (licence # M21002059) on May 25, 2021. Rebecca Do’s licence expired on March 31, 2024. Rebecca Do is Kim Do’s daughter.
  3. Kotis was first licensed as a mortgage agent (licence # M18000382) on February 15, 2018. Kotis became the principal broker of his own brokerage, Myriad Mortgage, on March 31, 2021. Kotis’ mortgage broker licence expired on March 31, 2024.
  4. Myriad Mortgage was first licensed as a mortgage brokerage (licence # 13357) on March 15, 2021. On March 5, 2024, Myriad Mortgage submitted an application to surrender its licence. The surrender application is pending.
  5. Chatterjee was first licensed as a mortgage agent (licence # M14000876) on May 26, 2014. Chatterjee became the principal broker of Mortgage Bridge Canada on June 4, 2019. She remains the principal broker.
  6. Mortgage Bridge Canada was first licensed as a mortgage brokerage (licence # 12426) on October 28, 2013. Mortgage Bridge Canada is currently licensed.
  7. Zambok and Ovejas have never held a mortgage agent licence. Zambok’s company, 501 Ontario, has never held a mortgage brokerage licence from FSRA.

B. Relationships between the Licensed Parties

  1. The mortgage brokerages Myriad Mortgage and Mortgage Bridge Canada were the authorizing brokerages for the mortgage agents involved in one or more of the mortgage deals for clients LS, BC, JT, MS, CB, LE, FM, and AC (collectively the “Affected Clients”) between 2021-2022.
  2. Between May 26, 2016, and April 27, 2022, Kim Do was an authorized mortgage agent at Mortgage Bridge Canada. Between April 28, 2022, and July 13, 2023, and again from August 9, 2023, until February 16, 2024, Kim Do was an authorized mortgage agent at Myriad Mortgage.
  3. Between November 15, 2021, and February 15, 2024, Rebecca Do was an authorized mortgage agent at Myriad Mortgage.

C. Unlicensed Mortgage Activities

  1. Zambok and Ovejas solicited the Affected Clients to obtain mortgages to fund payouts of the NOSIs, consulting fees, as well as home renovations which would be done by Zambok through his company Equitable Renovations Inc.
  2. Once clients were amenable to a mortgage, Zambok and Ovejas communicated with Kim Do to get a mortgage commitment. In some cases, Zambok and Ovejas created email accounts for the clients and impersonated them in correspondence with mortgage agents, lawyers, and other companies to facilitate the mortgage process and NOSI payouts.
  3. Zambok and Ovejas collected client information for mortgage applications, and provided them to Kim and Rebecca Do. They answered client questions on mortgages and mortgage applications, and obtained signatures on mortgage documents.
  4. Zambok and Kim Do discussed targeting clients by arranging a small mortgage, then doing home renovations later funded by reverse mortgages, and then getting another mortgage if needed. The Affected Clients ultimately entered into two to four mortgages each.
  5. The mortgages were complex, expensive, and the Affected Clients had limited understanding of the consequences. Affected Clients trusted that Ovejas, Zambok, Kim and Rebecca Do were acting in their interests, and did what they were told to do. In some cases, Affected Clients report being misled by Zambok and Ovejas about their obligations to pay for the mortgages.
  6. As the Affected Clients were retired and on fixed income, they were often unable to afford the mortgages, which has resulted in mortgage enforcements, loss of equity in their homes, and other harm.
  7. Ovejas and Zambok received remuneration from the proceeds of mortgages:
    1. Ovejas charged between $5,000 and $20,000 in consulting fees per Affected Client; and
    2. Zambok received remuneration through lender fees to 501 Ontario, a split of the consulting fees, and through payment on home renovation contracts, valued between $100,000 to $150,000 each.
  8. Zambok’s company, 501 Ontario, did not have a brokerage licence and did not operate through an exemption, but was the lender on mortgages to LS, BC, and AC.
    1. In April/May 2022, 501 Ontario provided a private mortgage to client AC in the amount of $170,000 with a lender fee of $17,500; and
    2. In June 2022, 501 Ontario provided a private mortgage to clients LS and BC in the amount of $49,500 with a $4,950 lender fee each.

D. Dealing in Mortgages Outside of Brokerage

  1. Kim Do arranged mortgages for LS, BC, and AC outside her authorizing brokerage with 501 Ontario as the lender. Kim Do received $4,000 for brokering the mortgage for AC, and $4,950 for brokering each private mortgage for LS and BC.
  2. LS, BC and AC were not provided with the brokerage disclosure required under the Act, such as the applicable annual percentage rate, total amount of all payments, cost of borrowing over the term of the mortgage expressed in dollars, and amortization schedules respecting these mortgages.

E. Brokering of Unsuitable Mortgages

  1. Kim and Rebecca Do did not do any meaningful assessment of suitability of the mortgages for the Affected Clients.
  2. Kim Do arranged mortgages for all the Affected Clients. She arranged mortgages for LS, BC, FM, CB, MS, and AC while she was authorized by Myriad Mortgage, and for CB, JT, and LE while she was authorized by Mortgage Bridge Canada.
  3. Kim Do occasionally instructed Rebecca Do to arrange mortgages for some of the Affected Clients. Rebecca Do arranged mortgages for JT, MS, FM through Myriad Mortgage.
  4. Each Affected Client had multiple mortgages that resulted in significant transaction fees and interest payments. In some cases, the cost of borrowing approached or exceeded Affected Clients’ annual income.
  5. The annual percentage rate (“APR”) expresses the cost of borrowing as a percentage of the principal paid on an annual basis. Most clients received mortgages with APRs between 25-45% on at least one mortgage, a higher cost of borrowing than most credit cards.
  6. Affected Clients demonstrated a lack of understanding of the fees associated with the mortgages in subsequent interviews conducted by FSRA and the Waterloo Regional Police Service.
  7. The Affected Clients trusted Zambok and Ovejas and followed their direction in signing documents. Often, Affected Clients did not know what they were signing or why. Zambok and Ovejas glossed over key terms, and downplayed concerns in order to acquire signatures on mortgage documents. In multiple instances, this resulted in Affected Clients being unaware of mortgages being registered on their property.
  8. Kim and Rebecca Do relied on unlicensed and conflicted individuals to solicit complex and risky mortgage strategies to the Affected Clients, which significantly limited their ability to properly assess client needs and circumstances.
  9. Kim Do often took direction from Zambok regarding what mortgage strategies were appropriate.
  10. Text messages between Kim Do, Zambok and Ovejas suggest that repayment of consulting fees and renovations was prioritized over ensuring mortgage were suitable for the Affected Clients.
  11. The mortgages were not suitable for Affected Clients and they suffered financial harm. Many clients who fully owned their homes a few years ago are now in significant debt and are at risk of losing them. Clients FM, CB, and LE entered mortgage enforcement proceedings after their mortgages matured without payment.
  12. Myriad Mortgage and Mortgage Bridge Canada failed to identify suitability issues with mortgages arranged by Kim and Rebecca Do.
  13. Kotis stated he “would not get too involved” for Kim Do’s mortgage deals and would review the deals only after the mortgage commitment was already signed.
  14. Chatterjee conducted minimal review of private mortgages arranged by Kim Do because she believed clients applying for private mortgages understood what they were getting into. She did not check with Kim Do to ensure mortgage suitability was being confirmed and exit strategies were being discussed with clients, and she did not conduct suitability reviews respecting clients LE and CB.

F. Conflicts of Interest

  1. Kim and Rebecca Do worked with Zambok to solicit and secure mortgage loans for the Affected Clients, sometimes taking direction from him regarding mortgage products and amounts.
  2. Kim and Rebecca Do worked similarly with Ovejas to solicit and secure mortgage loans for the Affected Clients.
  3. Zambok and Ovejas served as lucrative sources of deals resulting in over $84,000 in remuneration for Kim Do and $23,000 for Rebecca Do. However, Kim and Rebecca Do failed to disclose their relationships with Zambok and Ovejas to the Affected Clients.

G. Reverse Mortgages and Independent Legal Advice

  1. Kim and Rebecca Do arranged reverse mortgages for six of the Affected Clients, ranging between $205,500 to $429,300.
  2. Kotis confirmed that Myriad Mortgage did not have written statements signed by lawyers regarding the reverse mortgages Myriad Mortgage proposed. Nevertheless, Myriad Mortgage proceeded with arranging reverse mortgages for clients LS, BC, MS, and FM.
  3. Chatterjee confirmed that Mortgage Bridge Canada did not have written statements signed by lawyers regarding the reverse mortgages that the brokerage proposed. Nevertheless, Mortgage Bridge Canada proceeded with arranging reverse mortgages for clients CB and LE.

H. Missing Records

  1. After Myriad Mortgage ceased operations, Kotis discontinued Myriad Mortgage’s email service and cancelled its email account, stating that he could not continue to pay for it and that he did not need it.
  2. Kotis was unable to produce any text messages, notes, email messages, or communications in relation to any of the clients FSRA investigated that had mortgages brokered by Myriad Mortgage.
  3. Chatterjee stated that in December 2021, that Mortgage Bridge Canada changed systems, and that when it made the changes, it lost all email records, as well as completed mortgage documents such as signed application documents and related disclosures.
  4. Chatterjee was unable to locate signed and completed documents to respond to FSRA’s request for information relating to documents from mortgage transactions with clients JT and LE.

I. Non-Cooperation with FSRA’s Investigation

  1. On November 15, 2024, FSRA issued a summons to Kim Do to produce documents by December 3, 2024, and to appear virtually for an interview on December 12, 2024.
  2. Kim Do failed to produce the required documents and failed to appear for the interview.
  3. On November 15, 2024, FSRA issued a summons to Zambok and 501 Ontario to produce documents by December 3, 2024. The summons to Zambok also required him to appear virtually to meet with FSRA on December 13, 2024.
  4. On December 5, 2024, Zambok confirmed receiving the summons by email but failed to produce the required documents or attend the interview. Similarly, 501 Ontario did not produce the required documents.

III. CONTRAVENTIONS OR FAILURES TO COMPLY WITH THE ACT

A. Kim and Rebecca Do’s Contraventions or Failures to Comply with the Act

Dealing Outside of Brokerage
  1. Section 2(3) of the Act provides 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.
  2. The Director is satisfied that Kim Do contravened section 2(3) of the Act by arranging three private mortgage deals for clients LS, BC, and AC, outside her authorizing brokerage and without an exemption from the requirement to have such a licence.
  3. Section 4(1) of O. Reg. 187/08 states that 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.
  4. The Director is satisfied that Kim Do contravened section 4(1) of O. Reg. 187/08 by receiving broker fees from mortgage proceeds directly from 501 Ontario.
Causing Brokerage to Contravene the Act
  1. Section 3 of O. Reg. 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.
  2. The Director is satisfied that Kim and Rebecca Do contravened section 3 of O. Reg. 187/08 by causing their brokerages to contravene the Act as follows:
Disclosure of Conflicts of Interest

  1. Section 27(1) of O. Reg. 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 that the brokerage presents for the consideration of the borrower.

    Kim Do failed to provide conflict of interest disclosure on behalf of Myriad Mortgage regarding mortgages arranged for LS, BC, JT, MS, FM, and AC, and on behalf of Mortgage Bridge Canada regarding mortgages arranged for JT, CB, and LE. Rebecca Do failed to provide conflict of interest disclosure on behalf of Myriad Mortgage regarding mortgages arranged for JT, MS, and FM. In doing so, they caused their brokerages to contravene section 27(1) of O. Reg. 188/08.

Reverse Mortgages without Documented Independent Legal Advice

  1. Section 29(1) of O. Reg. 188/08 states that a brokerage shall not arrange or enter into a reverse mortgage with a borrower unless the brokerage receives from the borrower a written statement signed by a lawyer stating that the lawyer has given the borrower independent legal advice about the proposed reverse mortgage.

    Kim Do failed to provide lawyers statements to Myriad Mortgage regarding reverse mortgages she arranged for LS, BC, and FM, and to Mortgage Bridge Canada regarding reverse mortgages she arranged for CB, and LE. Rebecca Do failed to provide a lawyer’s statement to Myriad Mortgage respecting the reverse mortgage she arranged for MS. In doing so, they caused their brokerages to contravene section 29(1) of O. Reg. 188/08.

Reasonable Steps to Ensure Mortgage Suitability

  1. Section 24(1) of O. Reg. 188/08 states 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, lender or investor, as the case may be, is suitable for the borrower, lender or investor having regard to the needs and circumstances of the borrower, lender or investor.

    FSRA was not provided with any documentation to demonstrate that Kim or Rebecca Do conducted any suitability assessments with the affected clients. Kim and Rebecca Do also relied on Zambok and Ovejas as the primary point of contact with Affected Clients regarding the mortgages. Zambok and Ovejas were unlicensed and also conflicted given their pecuniary interests in promoting the mortgages. Kim Do failed to take reasonable steps to ensure suitability of mortgages she arranged on behalf of Myriad Mortgage for clients LS, BC, MS, FM, and AC, and on behalf of Mortgage Bridge Canada for JT, CB, and LE. Rebecca Do failed to take reasonable steps to ensure suitability of mortgages she arranged on behalf of Myriad Mortgage for JT, LE, and FM. In doing so, they caused their brokerages to contravene section 24(1) of O. Reg. 188/08.

Facilitating Fraud, Crime or Illegal Conduct
  1. Section 3.1 of O. Reg. 187/08 provides 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.
  2. The Director is satisfied that Kim and Rebecca Do knew or ought to have known that Zambok, Ovejas, and 501 Ontario were not licensed, yet they facilitated unlicensed activities by working with these individuals and entities and by acting as a front for their unlawful mortgage dealing and lending activities.
Non-Cooperation with FSRA’s Investigation
  1. Section 34(2) provides that a summons issued under subsection 34(1) may require a person, (a) to produce such documents and things as are specified by the Chief Executive Officer; and (b) to give such information on oath as the Chief Executive Officer or a person designated by the Chief Executive Officer considers relevant to determining whether a person or entity is complying with a requirement established under this Act.
  2. The summons issued by FSRA imposed a requirement on Kim Do under section 34 of the Act to provide the documents specified in the summons and to provide information under oath to the Chief Executive Officer.
  3. The Director is satisfied that by failing to provide documents specified in the summons and by failing to provide information under oath, Kim Do failed to comply with a requirement established under section 34 of the Act.

B. Zambok and Ovejas’ Contraventions or Failures to Comply with the Act

Dealing in Mortgages without a Licence
  1. Section 2(3) of the Act provides that no individual shall deal in mortgages in Ontario for remuneration, whether direct or indirect 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 a licence.
  2. Dealing in mortgages is defined in section 2(1) of the Act and includes soliciting another person or entity to borrow or lend money on the security of real property, providing information about a prospective borrower to a prospective lender, assessing a prospective borrower on behalf of a prospective lender; and negotiating or arranging a mortgage on behalf of another person or entity, or attempting to do so.
  3. The Director is satisfied that Zambok and Ovejas contravened section 2(3) of the Act through their dealing in mortgages with the Affected Clients. They solicited the Affected Clients to mortgage their homes, collected financial information from them on behalf of borrowers and arranged their mortgages.
  4. Zambok and Ovejas were remunerated by way of payment for consulting and renovation work through mortgage proceeds. Zambok was also compensated through lending fees paid to 501 Ontario. Zambok and Ovejas’ conduct does not fall under an exemption for the requirement of a licence under section 6 of the Act or O. Reg. 407/07.
Non-Cooperation with FSRA’s Investigation
  1. The summons issued by FSRA imposed a requirement on Zambok under section 34 of the Act to provide the documents specified in the summons and to provide information under oath to the Chief Executive Officer.
  2. The Director is satisfied that by failing to provide documents specified in the summons and by failing to provide information under oath, Zambok failed to comply with a requirement established under section 34 of the Act.

C. 501 Ontario’s Contraventions or Failures to Comply with the Act

Lending through Mortgages without a Licence
  1. Section 4(2) of the Act provides that no person or entity shall carry on business as a mortgage lender in Ontario unless he, she or it has a brokerage licence or is exempted from the requirement to have such a licence.
  2. Section 4(1) of the Act states that for the purposes of this Act, a person or entity is a mortgage lender in Ontario when he, she or it lends money in Ontario on the security of real property, or holds themself out as doing so.
  3. The Director is satisfied that the exemptions in section 6 of the Act and section 15 of O. Reg. 407/07 do not apply, and therefore that 501 Ontario contravened section 4(2) of the Act by lending money through mortgages arranged for clients LS, BC, and AC.
Non-Cooperation with FSRA’s Investigation
  1. The summons issued by FSRA imposed a requirement on 501 Ontario under section 34 of the Act to provide the documents specified in the summons to the Chief Executive Officer.
  2. The Director is satisfied that by failing to provide required documents, 501 Ontario failed to comply with a requirement established under section 34 of the Act.

D. Myriad Mortgage and Mortgage Bridge Canada’s Contraventions or Failures to Comply with the Act

Failing to Disclose Conflicts of Interest
  1. As discussed above, Kim and Rebecca Do did not disclose a conflict of interest or potential conflict of interest in connection with mortgages arranged for Affected Clients. Neither Kotis nor Chatterjee took reasonable steps to identify potential or actual conflicts of interest, and as such the conflicts were not disclosed.
  2. The Director is satisfied that Myriad Mortgage and Mortgage Bridge Canada contravened section 27(1) of O. Reg. 188/08 by failing to provide written disclosure of the potential conflicts of interest Kim and Rebecca Do had with Zambok, Ovejas, and 501 Ontario regarding mortgages arranged for the Affected Clients.
Arranging Reverse Mortgages without Documented Independent Legal Advice
  1. The Director is satisfied that Myriad Mortgage and Mortgage Bridge Canada contravened section 29(1) of O. Reg. 188/08 by failing to obtain lawyers statements of independent legal advice before proceeding to arrange with reverse mortgages with six of the Affected Clients. Neither Kotis nor Chatterjee required this documentation to proceed with the reverse mortgages.
Failing to Take Reasonable Steps to Ensure Mortgage Suitability
  1. As discussed above, Kim and Rebecca Do failed to take reasonable steps to ensure mortgages they arranged were suitable for the Affected Clients. Neither Kotis nor Chatterjee took reasonable steps to confirm the mortgages were suitable.
  2. The Director is satisfied that Myriad Mortgage and Mortgage Bridge Canada failed to take reasonable steps to ensure mortgages were suitable having regard to the needs and circumstances of the Affected Clients, contrary to section 24(1) of O. Reg. 188/08.
Failure to Maintain Records
  1. Section 46(1) of O. Reg. 188/08 states that a brokerage shall maintain the following records:
    1. Complete and accurate financial records of its licensed activities in Ontario.
    2. Complete and accurate records of every mortgage application, mortgage instrument and mortgage renewal agreement received or arranged by the brokerage.
    3. Complete and accurate records of every other agreement entered into by the brokerage in the course of dealing or trading in mortgages or in the course of mortgage lending.
    4. Complete and accurate records of all documents or written information given to or obtained from a borrower or prospective borrower, a lender or prospective lender, an investor or prospective investor or any other person or entity pursuant to a requirement established under the Act.
  2. Section 48(1) states that a brokerage shall retain all records that relate to a mortgage or mortgage renewal agreement, as the case may be, for at least six years after the expiry of the term of the mortgage or renewal or other expiry of the mortgage transaction.
  3. The Director is satisfied that Myriad Mortgage and Mortgage Bridge Canada contravened sections 46(1) and 48(1) of O. Reg. 188/08 by failing to maintain required records through preventable data loss.

E. Kotis and Chatterjee’s Contraventions or Failures to Comply with the Act

Failing to Take Reasonable Steps to Ensure Compliance
  1. Section 2(1) of O. Reg. 410/07 provides that the 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.
  2. The Director is satisfied that Kotis and Chatterjee contravened section 2(1) of O. Reg. 410/07 by failing to take reasonable steps to ensure the compliance of their brokerage and its agents.
  3. Kotis and Chatterjee’s compliance oversight failed to identify serious suitability issues with mortgages arranged by Kim and Rebecca Do. They allowed mortgages to be arranged without required independent legal advice and conflict of interest documentation. Both Kotis and Chatterjee failed to sufficiently back up brokerage files, leading to the loss of mortgage records regarding the Affected Clients. These lapses were serious, not reasonable, and they caused Myriad Mortgage and Mortgage Bridge Canada to contravene sections 27(1), 24(1), 29(1), 46(1), and 48(1) of O. Reg. 188/08.

IV. GROUNDS FOR IMPOSING ADMINISTRATIVE PENALTIES

  1. The Director is satisfied that imposing administrative penalties on the Parties 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.
  2. The Director is satisfied that administrative penalties in the total amount of $610,000 should be imposed on the Parties for contraventions of numerous sections of the Act, regulations, and requirements established under the Act as set out above.
  3. In determining the amount of the administrative penalties, the Director has considered the following criteria as required by section 3 of O. Reg. 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.
  4. In respect of the first criterion,
    1. Kim Do’s conduct was reckless or intentional. As an experienced agent, she knew or ought to have known that Ovejas, Zambok, and 501 Ontario were unlicensed, yet she facilitated their unlicensed activities and failed to conduct basic due diligence for her clients. Kim Do intentionally failed to comply with FSRA’s summons.
    2. Zambok, Ovejas and 501 Ontario’s conduct was reckless or intentional. They knew or ought to have known that their conduct amounted to unlicensed mortgage activities, and used Kim and Rebecca Do as a front to finance their consulting, renovation, and lending operations. Zambok and 501 Ontario intentionally failed to comply with FSRA’s summons.

    3. Kotis and Chatterjee’s conduct was reckless. As principal brokers, Kotis and Chatterjee committed to taking reasonable steps to ensure compliance of their brokerages and agents. Their failure to conduct reasonable due diligence on mortgage suitability, ensure conflicts of interest were disclosed, and require necessary documentation for mortgages submitted by Kim and Rebecca Do, deprived the Affected Clients of the protections provided by the Act which may have prevented the harm they suffered.

      Kotis intentionally cancelled Myriad’s email account, leading to the loss of brokerage records.

    4. Rebecca Do’s conduct was negligent. While she largely took direction from her mother, Rebecca Do ought to have known, and was responsible for following, the requirements that applied to her as a licensed mortgage agent.
  5. In respect of the second criterion,

    1. Affected Clients were older adults and vulnerable, and they suffered significant financial harm. Many clients who once fully owned their homes are now in significant debt and are at risk of losing them.

      JT was forced to sell his home to Zambok who then rented it back to him. Lenders brought mortgage enforcement proceedings against FM, CB, and LE after their mortgages matured without payment.

    2. The total cost of borrowing for mortgages arranged for the Affected Clients exceeded $600,000 in lender fees, finder fees, broker fees, brokerage fees, and interest on the mortgages.
    3. The activities of the Parties undermine confidence in the Act, mortgage agents, and mortgage brokerages. The Act’s protections only work where its requirements are followed by licensed entities.
    4. Zambok, Kim Do, and 501 Ontario’s failure to comply with FSRA’s investigation, as well as the record retention failures of Myriad Mortgage and Mortgage Bridge Canada, have slowed FSRA’s efforts to protect the public regarding the Affected Clients.
  6. In respect of the third criterion, the Parties made minimal efforts to mitigate losses or take remedial action. FSRA is aware that Zambok provided some restitution, including returning title to client JT as part of a settlement. Chatterjee advised FSRA that Mortgage Bridge Canada has updated its policies and procedures, and that Chatterjee has enhanced her suitability assessments. FSRA is not aware of proactive action taken by any other party to help Affected Clients. Kim Do, Zambok, and 501 Ontario failed to comply with FSRA’s investigation.
  7. In respect of the fourth criterion, the Parties derived substantial economic benefits from their contraventions.
    1. As each Affected Client entered two to four separate mortgages, Kim and Rebecca Do earned significant amounts through brokering fees. Kim Do received at least $70,000 in brokering fees. Rebecca Do earned at least $23,000 in brokering fees.
    2. Kim Do also received around $14,000 in fees from her dealings outside Myriad Mortgage.
    3. Ovejas and Zambok split consulting fees of $5,000 to $20,000 per Affected Client. Zambok received substantial remuneration from the renovations done for clients; Zambok’s corporation Equitable Renovations Inc. has received over $500,000 in profit for its work on Affected Clients’ homes, among others.
    4. 501 Ontario received lender fees of $25,500 from its unlicensed mortgage lending activities, excluding interest.
    5. Myriad Mortgage and Mortgage Bridge Canada earned around $6,000 and $1,000 respectively from brokering fees.
    6. As principal brokers of their brokerages, Kotis and Chatterjee benefited from the performance of their brokerages.
  8. In respect of the fifth criterion, Zambok, Ovejas, and Kim Do were criminally charged with fraud for their role in relation to some of the Affected Clients. FSRA is not aware of contraventions of the Act or other financial services legislation within the last five years.
  9. In determining the quantum for the proposed administrative monetary penalties, the Director has considered amendments made to section 41 of the Act that came into force on February 1, 2022, which increased the maximums for administrative monetary penalties as follows:
    1. For a contravention or failure to comply by an individual who is, or is required to be, licensed as a mortgage broker or agent, from $10,000 to $100,000; and
    2. For a contravention or failure to comply by a person or entity who is, or is required to be, licensed as a mortgage brokerage, from $25,000 to $500,000.
  10. The Director is satisfied that the proposed administrative penalties are not punitive having regard to all relevant circumstances.

V. GROUNDS FOR IMPOSING COMPLIANCE ORDER

  1. Section 35 of the Act provides:
    1. This section applies if, in the Chief Executive Officer’s opinion,
      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.
    2. The Chief Executive Officer may propose to order the person or entity to cease committing an act or cease pursuing a course of conduct identified by the Chief Executive Officer or to perform such acts as, in the Chief Executive Officer’s opinion, are necessary to remedy the situation.
  2. The Director is satisfied that the Compliance Order is necessary to protect the public and to remedy the systematic deficiencies demonstrated in the oversight of Mortgage Bridge Canada. The Compliance Order will ensure Mortgage Bridge Canada is accountable for brokering suitable mortgages. The Compliance Order is time-limited and proportionate to the deficiencies identified.
  3. Accordingly, the Director proposes to issue the Compliance Order under section 35 of the Act requiring the following of Mortgage Bridge Canada and Chatterjee, so long as she is designated Principal Broker:
    1. The Principal Broker of 2382314 Ontario Inc. o/a Mortgage Bridge Canada (“Mortgage Bridge Canada”) shall ensure the brokerage complies with sections 24(1), 27(1), 29(1), 46(1), and 48(1) of O. Reg. 188/08.
    2. The Principal Broker of Mortgage Bridge Canada shall ensure the brokerage’s policies and procedures include the following elements and shall provide mandatory training to its agents and brokers of same where applicable.
      1. Policies and procedures for identifying vulnerable consumers and for assessing suitability of mortgage products for vulnerable consumers;
      2. Policies and procedures to identify referral sources and to identify potential or actual conflicts of interest therein;
      3. Policies and procedures to capture phone calls, discussions, interactions with clients, lenders, and other relevant persons in writing, specifically addressing vulnerable consumers; and
      4. Policies and procedures for retaining records in compliance with sections 46(1) and 48(1) of the Act, including creating backups or redundancies to ensure the integrity of records through system changes.
    3. For a period of 12 months (the “Remedial Period”) and respecting every mortgage file prior to funding, the Principal Broker of Mortgage Bridge Canada shall:
      1. Ensure and attest that the proposed mortgage is suitable for the client having regard to the clients' needs and circumstances, including ensuring that the client understands any applicable fees, material risks, and exit plans; and
      2. Ensure and attest that referral sources have been considered, if applicable, and that all actual or potential conflicts of interest have been disclosed to the client.
    4. At the end of the Remedial Period, Mortgage Bridge Canada shall provide a report to FSRA outlining its activities under the Compliance Order. The report shall include a list of mortgages funded within the Remedial Period, the date in which any attestations were made, and an attestation that the brokerage’s policies and procedures were updated and training was provided in accordance with the Compliance Order.
  4. Such further and other reasons as may come to my attention.

DATED at Toronto, Ontario, 6/5/2025.

Original signed by

Elissa Sinha
Director, Litigation and Enforcement

By delegated authority from the Chief Executive Officer

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