The Ontario Securities Commission has rejected an application from Derivative Services Inc. and Malcolm Robert Bruce Kyle for a review of five decisions of the IDA against Kyle and his firm.

The commission panel dismissed the application relating to the first four hearings. It determined that the applicants failed to file notice requesting review of these rulings within the time requirements prescribed under the Commodity Futures Act.

The panel decided that it does have jurisdiction to review the fifth ruling of the IDA from July 18, 2000. In that decision, the IDA imposed discipline penalties on Kyle, as president and CEO of Derivative Services Inc., and DSI itself. It concluded that Kyle and DSI engaged in business conduct or practice that is “unbecoming or detrimental to the public interest” by failing to provide documents or other information requested by Association staff in the course of an investigation.

In early 1998, the Enforcement Division of the IDA began an investigation concerning compliance by DSI. In the course of that investigation, an investigator sent Kyle a written request for relevant documents and information from DSI. Neither Kyle nor DSI complied with the request. The commission imposed a fine of $45,000 on Kyle, a revocation of his approval and a bar on re-approval until the fine is paid.

The panel ordered Kyle and DSI to pay $5,000 towards the IDA’s costs. It fined DSI $35,000 and revoked its membership.

Kyle and DSI have not paid their fines or costs, and Kyle still has not turned over the requested documents.

IDA enforcement counsel Brian Awad points out that the decision that the OSC found it had jurisdiction to review, “concerns a very narrow point, namely, whether the District Council would re-open the hearing to hear further submissions as to costs.”

The discipline was imposed in a hearing convened June 29, 2000.