The British Columbia Securities Commission said Thursday that TD Securities Inc. has agreed to pay $50,000 in a settlement for acting contrary to the public interest.

The BCSC said that in March 1996, Grafton Global Management Ltd. made client investments through TD Securities when about 90 Grafton Global clients invested more than $4 million into Valley Mortgage and Investment Co. Ltd. “TD Securities failed to ensure that Grafton Global properly completed the documentation for the investments,” the commission said in a news release. “Then, TD Securities provided account statements to investors that referred to the investments as ‘TD mortgages’ which may have given investors a false sense of security about the safety of their investments. In 1999, mortgages underlying the Valley investments were in default, but despite this, TD Securities continued to list the value of the investments at the purchase price in the client statements.”

In March 1997, TD Securities purchased Grafton Global and George Melvin Grafton joined TD Securities. In the following months, seven of Grafton’s clients invested $450,000 in Valley. “The investments may not have been suitable for some of the clients,” the BCSC said.

The commission said that TD Securities acknowledged in the settlement that it voluntarily settled with the investors and revised its compliance procedures.

A hearing against George Grafton, Grafton Global and Valley starts in March of next year.