The Ontario Securities Commission (OSC) has stayed a suspension ordered against an exempt market dealer, and ordered that an investor alert it issued about the firm be rescinded, pending a hearing.
Back on Nov. 18, 2013, a deputy director of the OSC’s compliance and registrant regulation branch issued a decision permanently suspending the registration of Toronto-based Sterling Grace & Co. Ltd. and its principal, Graziana “Grace” Casale. The OSC also issued an investor alert following the decision.
The firm subsequently requested a review of that decision, and requested a stay of the initial decision to suspend the registrations, pending the outcome of that hearing. The firm also sought removal of the investor alert from the OSC’s website. OSC staff opposed the motion.
In a decision handed down on Nov. 28, 2013, the OSC granted the motion, stayed the suspension, and ordered the investor alert removed.
The commission concluded that the application for a review of the initial decision is not frivolous and that it raises a serious issue to be tried. The stay decision notes that the proposed grounds for reviewing the initial decision include a lack of adequate reasons in the initial decision, and failure to give due consideration and weight to the evidence submitted by the firm in the initial decision.
It also accepted the argument that the immediate enforcement of a permanent suspension of the registrations of Stirling Grace and Casele would significantly hurt the business; and, that the balance of convenience favours granting the stay.
“In the circumstances of this case, I am not satisfied that there is sufficient harm to the public interest to outweigh the harm that may be suffered by the applicants in the short term if an interim stay is not granted,” the OSC said in its decision; noting that this conclusion is based in part on the firm’s willingness to include a link to the original decision suspending its registration on its website, and to alert clients to that decision.
Following from the decision to grant the stay, the OSC also ordered the investor alert removed, given that the registrations are no longer suspended. However, it did not find grounds to issue a retraction of the alert.
The stay order is in effect until February 20 to give both sides time to address the issuance of a further stay order by the panel that presides over the review of the initial suspension decision.