The Ontario Securities Commission ordered almost $24 million in monetary sanctions against the operators of a viatical settlement company.
After a hearing that was concluded in January, the OSC found that Jeffrey Pogachar and Paola Lombardi, former directors and officers of failed life-settlements company New Life Capital Corp. and its subsidiaries, traded without registration and committed fraud. They did not appear at the hearing.
On Friday, following a sanctions hearing on May 11th, the commission ordered almost $22 million in disgorgement, $1.5 million in penalties, and more than $250,000 in costs, along with permanent trading bans against the pair. Its reasons will be issued at a later date.
The disgorgement order is to be paid jointly with a $22.5 million disgorgement order that was entered against the New Life group of companies, as well as several numbered companies, that earlier settled the case in an agreement approved in January 2011.
According to the OSC’s decision back in January, the New Life group of companies carried on business in the viatical and life settlement industry. The OSC alleged that, as the principals of New Life, Pogachar and Lombardi improperly engaged in trades without being registered, and that they fraudulently enticed investors by causing the company to pay dividends when it was not profitable, paying dividends from investor funds, and using investor funds for personal purposes.