Canadian Bridging Finance Placed in Receivership After Regulator Finds Mismanagement

An Ontario court has placed Canadian lender Bridging Finance Inc. in receivership and the provincial securities regulator ordered that all trading cease in securities in its funds for 15 days, Reuters reported. The actions followed an investigation by the Ontario Securities Commission (OSC) that found the Toronto-based company and Chief Executive David Sharpe mismanaged and misappropriated investment funds. The OSC also suspended Sharpe’s registration as the company’s Ultimate Designated Person, responsible for its conduct and supervision, according to a statement issued late on Friday. The Ontario Superior Court of Justice on Friday appointed PriceWaterhouseCoopers as BFI’s receivers. BFI managed about C$2 billion ($1.6 billion) at the end of December 2020. In its order, the OSC said its investigation had found that between Jan. 1, 2017, and April 30, 2020, BFI had used C$35 million of funds it managed to make an acquisition for itself; that Sharpe had personally received C$19.5 million from a person who had borrowed over C$100 million from BFI; and that BFI lent almost C$100 million to a borrower who was negotiating the acquisition of a 50% stake in the lender. Read more.