A Toronto mortgage broker, twice convicted for demanding advance fees from cash-strapped clients for loans that never materialized, has been barred from the industry for three years for a similar offence.
Glasford Alexander and his two companies, AAA Financial Consulting Inc. and SSKB Financial Corp., were fined a total of $60,000 in an Ontario court for operating as a mortgage broker without a licence. He was also ordered to pay restitution of $2,360 to three clients and not to work in money lending or mortgage brokering for three years.
Mr. Alexander placed ads in newspapers offering loans, even to people with bad credit. He charged fees for arranging loans but never actually provided his clients with any money.
Under Ontario's Loan Brokers Act, it is illegal to charge up-front fees to arrange a loan.
Mr. Alexander could not be reached yesterday for comment.
Dina Palozzi, superintendent of the Financial Services Commission of Ontario, said in a statement yesterday that the punishment should serve as a warning that anyone who engages in "dishonest" market conduct will face substantial fines. The biggest fine ever handed down is $74,000.
"We want to be clear that anyone who operates as an illegal mortgage broker in Ontario will be prosecuted," Ms. Palozzi said.
But this is the third time in four years that Ontario regulators have prosecuted Mr. Alexander for illegally charging up-front fees for loans. On the two prior occasions, he was sentenced each time to six months in prison and two years' probation and his companies were fined a total of $150,000.
Mr. Alexander was released on bail after appealing both convictions and kept on working as a mortgage broker. He successfully appealed the first conviction, handed down in November, 1997 -- instead of a jail term, he was fined $8,000. An appeal of the second conviction, handed down in May, 1998, is still pending.
Karen Howlett