Other: In the Matter of Buckingham Securities Corporation

Order

BUCKINGHAM SECURITIES CORPORATION

 

Regulation of Capital Markets in Ontario

The Ontario Securities Commission (the "Commission") regulates Ontario's capital markets. The mandate of the Commission is to provide protection to investors from unfair and fraudulent practices and to foster fair and efficient capital markets in Ontario and confidence in the integrity of the markets. To carry out its mandate, the Commission has authority to administer and enforce Ontario securities law, which includes the Securities Act (Ontario) (the "Act"), the General Regulation and Rules.

The Commission administers provisions of Ontario securities law which establish initial requirements that must be satisfied by dealers to obtain registration and impose on-going requirements applicable to registered dealers.

The Commission has the authority to take various proceedings to enforce or address failures to comply with Ontario securities law, including applications to court. Broad remedial powers are made available to the court when considering applications under the Act. In addition, the Commission itself has the authority to make orders that are "in the public interest" in a wide range of circumstances.


Buckingham Securities Corporation ("Buckingham")

As a registered securities dealer, Buckingham is subject to requirements relating to, among other things, submission of financial statements, minimum free capital and the segregation of client funds and securities. Staff of the Commission has identified an apparent failure to comply with these requirements.

On July 6, 2001 the Commission issued a Notice of Hearing and a Temporary Order under Sections 127 and 127.1 of the Act. Click on these links to read the Temporary Order, Notice of Hearing and News Release.

At a hearing on July 20, 2001 the Commission extended the Temporary Order made on July 6 and varied a part of the order. These orders are temporary, pending a hearing of the matter before the Commission, which hearing has been adjourned. Click on these links to read the Commission Order and News Release.

These Orders:

  1. suspend Buckingham's registration;
  2. prohibit all trading in securities by Buckingham and three individuals:
    • Lloyd Bruce, President and compliance officer of Buckingham
    • David Bromberg, a salesperson and a director of Buckingham; and
    • Harold Seidel, who appears to be a principal of Buckingham;
  3. cease all trading in securities in accounts in the name of Buckingham held at other dealers:
    • Rampart Securities Inc.
    • W.D. Latimer Co. Limited
    • Canaccord Capital Corporation
    • BMO Nesbitt Burns Inc.
    • Bear, Stearns & Co. Inc.
    • Dundee Securities Corporation
    • Caldwell Securities Limited
    • Laurentian Bank Securities.

 

Appointment of Receiver and Manager

On July 26, 2001 the Ontario Superior Court of Justice (the "Court") appointed BDO Dunwoody Limited as Receiver and Manager of Buckingham on the application of the Commission.

The Receiver is reviewing the books and records of Buckingham to make an assessment of the assets held by, and liabilities of, Buckingham. The Receiver will develop a plan for settling the liabilities of Buckingham and for dealing with client accounts. The Receiver will inform clients and others with financial interests relating to Buckingham and consider their interests in developing its plan. The Court will have the authority to approve or disapprove the Receiver's plan.

The Receiver has set up a web-site with information about its administration of the receivership. This web-site is to be updated regularly. Clients of Buckingham are encouraged to review the information presented on the Receiver's web-site (click here). For more information about the Receiver's activities you may call BDO Dunwoody at 416 369 3053 to listen to a recorded message.


Frequently Asked Questions


1. Can Buckingham trade securities for me?

The terms of the cease trade orders prohibit all trading by Buckingham.


2. Can I obtain securities that were being held on my behalf by Buckingham?

Securities that are held on behalf of clients in the name of Buckingham (sometimes referred to as "nominee-name accounts") are subject to administration of the Receiver and cannot be dealt with by clients.

Securities that are held on behalf of clients otherwise than in the name of Buckingham (sometimes referred to as "client-name accounts") may be transferred to the client's account at another registered dealer. In most cases, this will only apply when securities are held in a registered plan, such as an RRSP.


3. Can I transfer securities in my Buckingham account to another dealer or broker?

Clients who believe their securities are held in client-name accounts should confirm this with the Receiver. Clients may transfer these securities to an existing or new account at another appropriately registered dealer. The other dealer will be required to send requests for transfer documentation to the Receiver.

To find a new broker or dealer, you may wish to contact the OSC (the OSC Contact Centre telephone number is 416 593 8314 or 1-877-785-1555) or the Investment Dealers Association of Canada (IDA) for a list of brokers who are IDA members. Information about IDA-member dealers, including the list of members, is also available on the IDA web-site (click here).


4. What is the Receiver doing?

The Receiver has mailed account statements to all clients showing the status of the account as at the date of receivership (July 26, 2001). The Receiver requests that clients confirm the accuracy and completeness of the account statements by signing and returning them to the Receiver. Any differences or errors should be sent to the Receiver in a written statement, giving details.

The Receiver does not, at this time, have a clear indication of timing or extent of any recovery of funds or securities for clients or other creditors, as there are many key unresolved issues. Clients can be assured, however, that the Receiver is working diligently to resolve outstanding issues and claims and is mindful of the interests of the clients.

The Receiver has set up a web-site with information about its administration of the receivership. This web-site is to be updated regularly. Clients of Buckingham are encouraged to review the information presented on the Receiver's web-site (click here). For more information about the Receiver's activities you may call BDO Dunwoody at 416 369 3053 to listen to a recorded message.

Last Updated: September 20, 2001