Court appoints Trustee to oversee mortgage administrator BDMC
April 20, 2018
The Superintendent of Financial Services has successfully applied to the Ontario Superior Court of Justice to appoint FAAN Mortgage Administrators Inc. (FAAN Mortgage) as the Trustee to administer BDMC’s syndicated mortgage loans in accordance with the Court order issued today.
In February 2018, FSCO issued orders, pursuant to a settlement, against BDMC, three other mortgage brokerages, and four licensed individuals involved with syndicated mortgage loans. At that time, BDMC voluntarily agreed that FAAN Mortgage, an arms-length licenced mortgage administrator, would take over management of BDMC’s mortgage administration business for the benefit of investors in BDMC’s existing syndicated mortgage loans.
Since FAAN Mortgage started managing BDMC’s mortgage administration business, BDMC has committed multiple breaches of the agreement between the two entities, including restricting access to investor data. This, among other things, impeded FAAN Mortgage’s ability to carry out its responsibilities, leading FSCO to seek a Court-appointed Trustee.
As Court-appointed Trustee, FAAN Mortgage will now have additional powers and the support of the Court to help protect investors, such as unfettered access to financial books and records, and the ability to contact borrowers and lenders without hindrance.
FAAN Mortgage will be contacting investors to advise them of its appointment by the Court as Trustee. Investors with syndicated mortgage loans administered by BDMC may contact FAAN Mortgage at firstname.lastname@example.org and 1-833-495-3338 to inquire about their investments.
FSCO considers syndicated mortgages investments to be high risk, and may not be suitable for the average lender or investor. Potential lenders or investors, including consumers and retail investors, are strongly encouraged to seek independent financial and legal advice before lending money through, or investing in, a syndicated mortgage. FSCO does not have the authority to offer restitution for any financial losses related to investments or its enforcement actions.
For media enquiries only:
Financial Services Commission of Ontario
Toll free: 1-800-668-0128, ext. 7795