Decision in brief: Mughal Asset Management Corporation, Enforcement Proceeding, Sanctions and Costs, June 3, 2024

In an earlier decision, the Tribunal decided that Usman Asif and his companies, Mughal Asset Management Corporation and Lendle Corporation, committed fraud. The Tribunal also decided that Asif lied to OSC staff during the investigation, shared confidential OSC information, and interfered with the OSC’s investigation.

In this decision, the Tribunal decided what sanctions and costs should be ordered against the respondents for their misconduct.

The Tribunal decided that the respondents should be permanently banned from participating in Ontario’s capital markets. The respondents’ conduct was very serious, it caused harm to investors and the respondents knew that what they were doing was wrong. A permanent ban will send a message to the respondents and others that there are severe consequences for these acts.

The Tribunal also decided that the respondents must jointly pay an administrative penalty of $800,000 and must jointly disgorge (give up to the Commission) the money obtained through fraud. Asif must pay an additional administrative penalty of $350,000 for the investigation-related breaches. These amounts reflect the seriousness of the conduct and are comparable to previous Tribunal decisions that had similar facts.

Finally, the Tribunal decided that the respondents must jointly pay $295,413.65 in costs to the Commission. This was the amount the OSC asked for after reducing the amount of costs it actually incurred to account for some time spent on a separate but related proceeding.