The Ontario Securities Commission (OSC) has permanently banned a convicted fraudster from the capital markets, the provincial regulator announced on Tuesday.
An OSC hearing panel has handed down a permanent ban against Paul DiNardo, who was convicted on five counts in the Ontario Superior Court of Justice back in February of last year. The five convictions included two for fraud over $5,000, stemming from a couple of investment schemes. In April 2015, DiNardo was sentenced to five years in prison, less two years and 10 months for pre-trial credit.
In August 2015, OSC staff sought an order permanently banning DiNardo. He did not participate in the regulator’s hearing, which was held in September 2015.
See: OSC seeks sanctions against admitted fraudster
In its decision released on Tuesday, the OSC panel notes that DiNardo recruited investors to high-yield investment schemes that supposedly involved investing in oil and real estate companies, but which turned out to be Ponzi schemes that garnered approximately $13 million from investors. Of that total, approximately $6 million was paid to investors in the scheme, and another $400,000 was recovered by the authorities. More than $6 million was unaccounted for, and the decision indicates that DiNardo personally received more than $2.1 million of that.
“Most investors were not wealthy. Many invested borrowed funds, funds that had been set aside for retirement, or funds set aside for university tuition or housing costs for their children,” the panel decision says.
The panel concluded that the fraud convictions involved securities, and that a permanent ban was warranted. The frauds represent “among the worst possible abuses of the capital markets that an individual could commit upon numerous innocent victims,” the panel decision says, and “it is in the public interest to remove DiNardo from Ontario’s capital markets permanently.”
DiNardo was also convicted in connection with a scheme involving his 87-year old physician, who invested more than $1.1 million in DiNardo’s company with the promise of a high return. However, the doctor only recovered $32,500.