The Ontario Securities Commission (OSC) has settled with a scholarship plan dealer and its affiliates over various disclosure, registration, and supervisory failures.

The OSC announced that it has approved a settlement agreement with scholarship plan dealer, Global RESP Corp., fund manager, Global Growth Assets Inc. (GGAI), and the Global Educational Trust Foundation, along with the CEO of the firms, Issam El-Bouji, and the dealer’s chief compliance officer, Margaret Singh.

Under the terms of the deal, Bouji is required to disgorge almost $2 million, Bouji, GGAI and Global RESP are to pay an administrative penalty of $150,000 and costs of $75,000. Additionally, Bouji is permanently suspended as the ultimate designated person (UDP) of Global RESP and GGAI; the firms are ordered to create independent boards of directors; and, Bouji is prohibited from becoming a director or officer of any reporting issuer, registrant, and investment fund manager for nine years.

The sanctions come in response to findings that the respondents in the case violated the public interest due to prospectus disclosure failures, failing to refer conflicts to an independent review committee, and compliance and supervisory failings, among other things.

Scholarship plan facing OSC hearing

The settlement notes that the respondents maintain that plan subscribers and beneficiaries have not suffered any harm, that the transactions in question were done for the benefit of plan subscribers and beneficiaries on commercially reasonable terms, and that they cooperated with OSC staff. Additionally, they report that they have spent $1.35 million to bolster their compliance systems.