In a series of recent Ontario Securities Commission (OSC)
administrative proceedings, enforcement staff of the OSC (Staff)
have sought to present the allegations against respondents in a
manner that would, if accepted, effectively double the size of
monetary penalty that can be imposed.
BACKGROUND: THE OSC ENFORCEMENT FRAMEWORK
The Ontario Securities
Act (Act) contains specific operative provisions —
such as those establishing rules for offerings, take-over bids and
other matters — and also contains a series of
“basket” provisions, which set out general
prohibitions. As an example of a “basket” provision,
the quasi-criminal offence provision in section 122 of the Act
serves to generally make it an offence to make misrepresentations
in securities-related documents, or to contravene Ontario
securities laws. Procedurally, Staff must proceed through the
courts, rather than through an OSC panel, in order to initiate
quasi-criminal prosecutions under section 122.
