The Ontario Securities Commission has published its reasons for denying registration to a former boiler room broker, while suggesting that it will allow him to regain his registration later this year.

At a hearing back on Dec. 14, 2000, the OSC decided not to allow Neil DiCostanzo to register as a salesperson. The decision was issued by OSC director Robert Kohl on Jan. 11, 2001, but only now are the reasons being issued.

DiCostanzo was previously employed at boiler room Gordon-Daly Grenadier Securities, first as a non-registered telemarketer (qualifier) and, then, as a registered salesperson. After the firm was shuttered by the OSC last summer, DiCostanzo applied to be registered with BMO Nesbitt Burns Inc.

Staff of the OSC opposed his application on the grounds that he was not suitable for registration. DiCostanzo requested a hearing, in which staff’s position was upheld despite testimony from BMO Nesbitt Burns, which was willing to impose restrictive supervision on his license.

In a letter dated Aug. 22, 2000, commission staff submitted that DiCostanzo’s application for registration should be denied on the grounds that he was not suitable for registration because, while employed by Gordon-Daly, he resold stocks to his clients at excessive mark-ups and failed to deal fairly, honestly and in good faith with clients.

Kohl wrote in his decision, “With respect to his professed ignorance of what was going on at Gordon-Daly, I am of the belief that Mr. DiCostanzo knew much more than he was prepared to admit and that in many cases his answers reflected a convenient ignorance.”

On the basis of the evidence given at the hearing, Kohl found that DiCostanzo did not discharge his obligations to act fairly, honestly and in good faith with his clients.

Nevertheless, Kohl indicates that after at least a year’s reflection (from August 22, 2000, when OSC staff recommended against his re-registration), he will be inclined to approve his registration provided that: no new facts arise that are relevant to DiCostanzo’s suitability for registration, and DiCostanzo successfully completes the Conduct and Practices Handbook Course.