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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 38 and 39;

AND IN THE MATTER OF Elvira Montoya


MINUTES OF SETTLEMENT AND UNDERTAKING

    PART I – INTRODUCTION

  1. Elvira Montoya (“Montoya”) has never been licensed as a mortgage agent, broker, or other licencee pursuant to the Act.

  2. Secured Funds Inc. (“Secured Funds”) is a corporation that is solely owned and directed by Montoya. Secured Funds has never been licensed as a mortgage brokerage, administrator, or other licencee pursuant to the Act.

  3. On April 13, 2022, the Director, Litigation and Enforcement (“Director”), by delegated authority from the Chief Executive Officer (“CEO”) of the Financial Services Regulatory Authority of Ontario (“FSRA”), issued a Notice of Proposal in respect of Montoya (the “NOP”).

  4. Montoya disputed the allegations and, on or about April 29, 2022, requested a hearing before the Financial Services Tribunal (the “Tribunal”) in respect of the NOP.

  5. Montoya and the Director, by delegated authority from the CEO, (collectively the “Parties”) wish to resolve this matter on consent and without a hearing before the Tribunal.

  6. PART II – AGREED FACTS

  7. Between September 2019 and February 2020, Montoya’s sister, working on the behalf of Montoya and Secured Funds, drafted five letters of direction (the “Letters”) falsely depicting that Secured Funds had a brokerage licence, pursuant to the Act. Two separate licensing numbers were used by Montoya’s sister, neither of which were valid licences held by Montoya or Secured Funds.

  8. Montoya was aware that her sister had a history of making errors in drafting similar documents for Secured Funds. Montoya did not take steps to review the Letters drafted by her sister.

  9. Montoya arranged to visit each of the mortgage clients and have them sign the Letters. She did not identify to the clients that the Letters’ licensing numbers were false or that neither Secured Funds nor Montoya were licensed under the Act.

  10. Montoya personally sent each of the Letters to Diamond & Diamond LLP. The Letters provided for Secured Funds to receive $38,000 in “broker fees”. Montoya accepted these fees on behalf of Secured Funds.

  11. PART III – NON-COMPLIANCE WITH THE ACT

  12. By engaging in the conduct described above in Part II, Montoya admits and acknowledges that she has breached the Act as follows:

    1. Montoya used a prohibited title in depicting her business, Secured Funds, and referred to Secured Funds as a licensed mortgage brokerage without it having been issued a licence, contrary to section 11(1) of the Act.

    2. Montoya’s use of false licensing numbers reasonably could be expected to have misled that Secured Funds was a licensed mortgage brokerage, when it was not licensed as such under the Act, contrary to section 11(2) of the Act.


  13. Montoya acknowledges and agrees that she shall pay a $10,000 administrative penalty.

  14. PART IV – TERMS OF SETTLEMENT

  15. Montoya admits the facts contained in Part II of these Minutes.

  16. Montoya acknowledges and agrees that she has been given the opportunity to seek independent legal advice and has done so (or has waived the right to do so) and is entering into these Minutes of Settlement and Undertaking (“Minutes”) voluntarily, understanding the consequences of doing so.

  17. Montoya acknowledges that these Minutes are an undertaking within the meaning of the Act, and that failure to comply may result in immediate regulatory action including, but not limited to, the issuance of a Notice of Proposal to revoke the licence, a Notice of Proposal to impose an administrative penalty, or a prosecution under the Provincial Offences Act.

  18. (a) Issuance of Order

  19. Montoya acknowledges that, upon execution of these Minutes by both Parties, the order attached as Schedule “A” to these Minutes (the “Order”) will be issued.

  20. (b) Process for Execution of Settlement

  21. Montoya acknowledges that these Minutes are not binding on the Director until signed by the Director.

  22. These Minutes may be executed in counterparts, and may be executed and delivered by facsimile or e-mail, and all such counterparts and facsimiles or e-mails, as applicable, shall together constitute one and the same agreement.

  23. Upon receiving an executed copy of these Minutes from FSRA, Montoya will withdraw their Request for Hearing (Form 1) in respect of the NOP before the Tribunal by completing a Withdrawal/Discontinuance (Form 5) and filing it with the Registrar at the Tribunal within two (2) business days.

  24. Upon confirmation from the Tribunal that the Request for Hearing has been withdrawn and the hearing has been cancelled, the Parties agree that the Director will issue an Order in the form attached as Schedule “A” to these Minutes.

  25. The Parties accept and understand that these Minutes and any rights within the Minutes shall enure to the Parties and to any successors or assigns of the Parties.

  26. (c) Disclosure of Minutes and Order

  27. The Parties will keep the terms of these Minutes and the Order confidential until the Order is issued, except that:

    1. The Director shall be permitted to disclose the Minutes and the Order within FSRA; and

    2. The Parties shall be permitted to inform the Financial Services Tribunal.


  28. If either of the Parties do not sign these Minutes or the Director does not issue the Order:

    1. These Minutes, the Order, and all related discussions and negotiations will be without prejudice to FSRA and Montoya; and

    2. FSRA and Montoya will each be entitled to all available proceedings, remedies and challenges, including proceeding to a hearing of the allegations contained in the NOP. Any proceedings, remedies and challenges will not be affected by these Minutes, the Order, or any related discussions or negotiations.


  29. Upon issuance of the Order:

    1. Montoya agrees that these Minutes and the Order form part of their administrative record for the purposes of any future licensing decision or as an aggravating factor in respect of a future administrative penalty or prosecution against them or any affiliated entities;

    2. Montoya acknowledges that these Minutes and the Order are public and will be published by FSRA on its public website (or that of its successor) along with a press release that summarizes these Minutes and the Order; and

    3. The Parties agree not to make representations to any member of the public or media or in a public forum that are inconsistent with these Minutes or the Order.


  30. (d) Further Proceedings

  31. Whether or not the Order is issued, Montoya will not use, in any proceeding, these Minutes or the negotiation or process of approval of these Minutes as the basis for any attack on FSRA’s jurisdiction, alleged bias, alleged unfairness, or any other remedies or challenges that may be available.

  32. Upon issuance of the Order:

    1. Montoya waives all rights to a hearing before the Tribunal regarding the NOP;

    2. Montoya waives all rights to a judicial review or appeal of the Order;

    3. The Director agrees that FSRA will not take any further proceedings against Montoya arising solely from the facts contained in Part II of these Minutes, unless facts not disclosed by Montoya come to the attention of FSRA that are materially different from those contained in Part II of these Minutes or Montoya fails to comply with any term in the Order; and

    4. Montoya agrees that should she fail to comply with any term in these Minutes or the Order, FSRA is entitled to bring any proceedings available to it.


DATED at Woodbridge, Ontario

Original signed by

Elvira Montoya

DATED at Woodbridge, Ontario, Sept 1, 2022

Original signed by

Eugene Cybulski
Name of Witness

DATED at Toronto, Ontario, September 1, 2022

Original signed by

Elissa Sinha
Director, Litigation and Enforcement

By delegated authority from the Chief Executive Office

Financial Services Regulatory Authority of Ontario

APPENDIX A

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

AND IN THE MATTER OF Elvira Montoya

ORDER

An administrative penalty in the amount of $10,000 is hereby imposed on Montoya, for the reasons set out in the Notice of Proposal.

TAKE NOTICE THAT the Financial Services Regulatory Authority of Ontario (“FSRA”) will deliver an invoice to Elvira Montoya (“Montoya”), with information as to where and how to pay the administrative penalty. Montoya must pay the administrative penalty no later than thirty (30) days after the date of the invoice.

If Montoya fails to pay the administrative penalty in accordance with the terms of this Order, the Chief Executive Officer may file the Order with the Superior Court of Justice and the Order may be enforced as if it were an order of the court. An administrative penalty that is not paid in accordance with the terms of the order imposing the penalty is a debt due to the Crown and is enforceable as such.

Dated at Toronto, Ontario, , 2022

Elissa Sinha
Director, Litigation and Enforcement

By delegated authority from the Chief Executive Office

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