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The regulatory settlement with staff of the Ontario Securities Commission stems from accusations Home Capital misled investors for months about an internal probe in 2014 and 2015 that led the alternative mortgage lender to cuts ties with 45 brokers over falsified income documentation used for some real estate loans.

Home Capital founder Gerald Soloway, former chief executive Martin Reid, and former chief financial officer Robert Morton are all part of the proposed settlement agreement with OSC staff, which must be approved by a panel of commissioners at Canada’s largest capital markets watchdog set to convene at a hearing August 9.

The class action settlement is dependent on court approval, and each settlement is dependent on the other.

In the OSC settlement, the company agreed to pay an administrative penalty of $10 million. In addition, Soloway will pay $1 million, and each of the two others named will pay $500,000.

If the proposed settlement is approved, Soloway, Morton, and Reid will be restricted in their capital markets activities. Soloway is to be reprimanded by the commission, and will be prohibited from acting as a director or officer of any reporting issuer for a period of four years. Morton and Reid are also to be reprimanded and will each be prohibited from acting as a director or officer of any reporting issuer for two years.