The Ontario Securities Commission has issued its’ reasons for denying continued registration to a fund dealer that has not yet been accepted into the Mutual Fund Dealers association.

The firm, Norlyn Financial Group Inc., was first granted registration in 1998 as a securities dealer. In May 2001, Norlyn changed its registration category to mutual fund dealer. As a result of the change in registration category, Norlyn was required to become a member of the Mutual Fund Dealers Association by July 2, 2002. On June 28, 2002 Norlyn received a temporary exemption from this requirement, which expired Dec. 1, 2002.

Norlyn applied for another temporary exemption on Nov. 28, 2002. That exemption was not granted and instead terms and conditions were imposed on its registration at renewal.

Norlyn applied for renewal registration on Dec. 1, 2002 and on Dec. 31, 2002 renewal of registration was granted subject to terms and conditions. The registration was renewed again on June 1, 2003 with the continuation of the terms and conditions.

Norlyn applied for renewal of registration on Dec. 29, 2003. On Dec. 30, 2003, staff of the OSC advised Norlyn by letter that it had recommended that the director not grant renewal of registration “because it had not corrected the deficiencies in its application for membership identified by the MFDA”.

The firm appealed that decision, but the OSC turned it down. In his decision, director, David Gilkes, notes, “In addition to the written submissions provided to me, I contacted the MFDA and learned that Norlyn had not yet been accepted into membership. Based on submissions and the additional information from the MFDA, I deny to renew the registration of Norlyn as a Mutual Fund Dealer. Once Norlyn receives membership in the MFDA, it can apply to have its registration reinstated.”