Northern Financial Corp. has reached a settlement with a chat board user, who allegedly defamed the company on an Internet bulletin board.

Northern entered into a settlement agreement with Mario Rigolli Jr. of Montreal, who has consented to a judgment in favour of Northern as a result of his publication of a series of defamatory postings against Northern and its management team. The postings were made under five different user names on an Internet chat board known as Bullboards owned and operated by Stockhouse Media Corp.

Rigolli has paid an undisclosed cash settlement to Northern and has provided Northern and its management with a signed apology for writing and posting, “a series of derogatory, malicious, defamatory and completely false statements about Northern Financial Corp. and Mr. Alboini (company CEO Vic Alboini).”

In his signed apology, Rigolli stated “I categorically and without reservation withdraw each and every one of my postings. I greatly regret that I made the postings and I sincerely apologize both to Mr. Alboini and to NFC for the postings. I am not and have never been a shareholder of NFC. I have never made any short sales of NFC shares. I never profited in any manner as a result of my defamatory postings.”

Northern says it does not consider the cash amount paid under the settlement agreement to be material. However, it considered it appropriate to disclose this settlement primarily for public service reasons: to deter similar conduct, to inform other public companies which face similar potential defamatory postings on chat board sites.

In a separate matter, Northern Securities Inc., a wholly owned subsidiary of Northern Financial, has agreed to pay a $10,000 fine and cost of $5,000 as part of a settlement with the Investment Dealers Association.

The agreement concerns capital deficiencies in the firm during the period between February 2001 to April 2001.

The settlement is subject to the approval of a panel of the Ontario District Council to be held on December 12, 2001.