A three-member panel of the Ontario Securities Commission has rejected an agreement between OSC staff and Michel Cowpland designed to settle allegations of insider trading against the former Corel Corp. chief executive officer.

The panel said it rejected the settlement because it failed to send a strong enough message about the severity of insider trading.

The agreement would have seen Cowpland pay a $500,000 fine to the OSC, plus legal costs. As well, Cowpland would receive a two-year ban from serving as an officer or director of a public company.

The panel’s decision means OSC staff and Cowpland must try to work out a revised settlement. If an agreement isn’t reached, the matter would likely proceed to a full hearing.

Earlier this week, Cowpland’s holding company pleaded guilty in an Ontario court to insider trading charges dating back to 1997, and agreed to pay a $1 million fine.