Notice Of Proposed Cease and Desist Order and Interim Cease and Desist Order Against  Rockval Holding Corporation ("Rockval"), East Bonding Canada Corporation ("East Bonding") and Claude Vallée

REGARDING the Insurance Act, R.S.O. 1990, c. I.8, as amended, (the "Act") in particular section 441

AND REGARDING a Proposed Cease and Desist Order against Rockval Holding Corporation, East Bonding Canada Corporation and Claude Vallée

AND REGARDING an Interim Cease and Desist Order against Rockval Holding Corporation, East Bonding Canada Corporation and Claude Vallée

NOTICE OF PROPOSED CEASE AND DESIST ORDER
and
INTERIM CEASE AND DESIST ORDER

The Superintendent of Financial Services ("Superintendent") is of the opinion that Rockval Holding Corporation ("Rockval"), East Bonding Canada Corporation (“East Bonding”) and Claude Vallée have committed, and are committing, unfair or deceptive acts or practices in the business of insurance in the Province of Ontario. The particulars are set out in the Report of the Superintendent which will be served upon Rockval, East Bonding, and Mr. Vallée with this Notice and Order.

TAKE NOTICE THAT pursuant to section 441(2) of the Act, the Superintendent intends to order Rockval, East Bonding and Mr. Vallée, and any agents and representatives thereof, to:

A. Immediately cease carrying on the business of insurance in the Province of Ontario as an insurer and /or agent;

B. Immediately cease issuing or delivering insurance policies, including any form of surety bond to or on behalf of persons resident or carrying on business in Ontario;

C. Immediately cease collecting money or anything else of value from any member of the public, in exchange for assisting in the placement of surety bonds in Ontario of any kind;

D. Immediately cease issuing any surety bonds in respect of property or construction projects located in Ontario;

E. Immediately cease soliciting the sale of surety bonds of any form in Ontario;

F. Immediately cease advertising in any form within Ontario;

G. Immediately provide the Superintendent with a written list of all surety bonds, bid bonds or performance bonds issued to, or on behalf of, persons resident or carrying on business in Ontario within the previous twelve (12 ) months, along with a list of all claims paid with the previous twelve (12) months and a list of all pending claims; and

H. Immediately mail to all persons in Ontario, to whom sureties have been issued, a copy of the Cease and Desist Order and provide evidence satisfactory to the Superintendent that the mailing was done.

WITHIN 15 DAYS after receiving this notice, the persons named in this notice may request in writing that the Financial Services Tribunal hold a hearing before the Superintendent takes any action described in this notice.

IF NO HEARING IS REQUESTED within 15 days, the Superintendent may make a permanent order in accordance with this notice, which shall take effect on the date set out in the order.

Any request for a hearing should be directed to:
Financial Services Tribunal
5160 Yonge Street
Toronto, Ontario M2N 6L9
Attention: Registrar
Fax No.: (416) 226-7750

INTERIM CEASE AND DESIST ORDER

Pursuant to section 441(4) of the Act, the Superintendent is of the opinion that the interests of the public may be prejudiced or adversely affected by a delay in the issuance of a permanent order for the following reasons:

  1. Mr. Vallée is a director of Rockval and East Bonding, which companies are engaged in the business of insurance in Ontario without a licence, contrary to the Act and regulations.
  2. Mr. Vallée is also a director of Gestion Lamca Inc. (otherwise known as Lamca Holdings Inc.) ("Lamca"), Société Canadienne de Cautionnement (S.C.C.) Inc. (otherwise known as Canadian Bonding Corporation) ("SCC"). By Interim Cease and Desist Order dated May 19, 2005, the Superintendent ordered Lamca, SCC and Roger Goulet (a director of those companies) to cease engaging in the business of insurance in Ontario. That Order became permanent on March 3, 2006. Documents recently obtained by the Superintendent show that Vallée has been personally involved in the insurance business of Lamca and SCC in Ontario.
  3. Rockval and East Bonding have continued the business of Lamca and SCC in Ontario by soliciting or providing insurance in the form of bonds and surety to construction companies in Ontario, including customers of Lamca and SCC.
  4. These acts are in violation of the Act.
  5. These acts are a clear and flagrant attempt to circumvent the May 19, 2005 Cease and Desist Order against Lamca and SCC.

In accordance with section 441(4) of the Act, the Superintendent, without prior notice, may make an interim order which will take effect immediately.

ORDER

Effective this date, pursuant to section 441(4) of the Act, the Superintendent orders that Rockval Holding Corporation, East Bonding Canada Corporation and Claude Vallée, and any agents and representatives thereof:

A. Immediately cease carrying on the business of insurance in the Province of Ontario as an insurer and /or agent;

B. Immediately cease issuing or delivering insurance policies, including any form of surety bond to or on behalf of persons resident or carrying on business in Ontario;

C. Immediately cease collecting money or anything else of value from any member of the public, in exchange for assisting in the placement of surety bonds in Ontario of any kind;

D. Immediately cease issuing any surety bonds in respect of property or construction projects located in Ontario;

E. Immediately cease soliciting the sale of surety bonds of any form in Ontario;

F. Immediately cease advertising in any form within Ontario;

G. Immediately provide the Superintendent with a written list of all surety bonds, bid bonds or performance bonds issued to, or on behalf of, persons resident or carrying on business in Ontario within the previous twelve (12 ) months, along with a list of all claims paid with the previous twelve (12) months and a list of all pending claims; and

H. Immediately mail to all persons in Ontario, to whom sureties have been issued, a copy of the Cease and Desist Order and provide evidence satisfactory to the Superintendent that the mailing was done.

TAKE NOTICE THAT the above Interim Cease and Desist Order shall become permanent unless within 15 days a written request for a hearing before the Financial Services Tribunal is made.

AND FURTHER TAKE NOTICE THAT if a hearing is requested, the Superintendent may extend the interim cease and desist order until the hearing before the Financial Services Tribunal is concluded.

AND FURTHER TAKE NOTICE THAT section 447(2)(b) of the Act provides that any person who fails to comply with any order made under the Act is guilty of an offence and liable on first conviction to a fine of not more than $100,000 and on each subsequent conviction to a fine of not more than $200,000.

AND FURTHER TAKE NOTICE THAT section 447(4) of the Act provides that every director, officer, and chief agent of a corporation who caused, authorised, permitted or participated in a corporation committing an offence, or who fails to take reasonable care to prevent a corporation form committing an offence, is also guilty of an offence and is liable on first conviction to a fine of not more than $100,000 and on each subsequent conviction to a fine of not more than $200,000.

AND TAKE FURTHER NOTICE THAT the hearing before the Tribunal will proceed in accordance with the Rules of Practice and Procedure of the Financial Services Tribunal under the authority of the Statutory Powers Procedure Act, R.S.O. 1990, Chapter S.22. The Rules of Practice and Procedure are available at the website of the Tribunal: http://www.fstontario.ca. Alternatively, a copy can be obtained by telephoning the Registrar of the Financial Services Tribunal at (416) 226-7294, or toll free at 1-800-668-0128 ext. 7294.

ISSUED AT the City of Toronto, this day of , 2006.

 

______________________________
Robert Christie
Superintendent of Financial Services

TO:

Claude Vallée
c/o Rockval Holding Corporation
2603 de la Faune
Saint-Émile (Québec) G3E 1J4

AND TO:

Rockval Holding Corporation
c/o 2603 de la Faune
Saint-Émile (Québec) G3E 1J4

AND TO:

East Bonding Canada Corporation
c/o 2603 de la Faune
Saint-Émile (Québec) G3E 1J4