Former rep escapes jail sentence

An Ontario appeal court has dismissed a former rep’s efforts to overturn his conviction for violating securities laws, but the court did cut his sentence.

According to a ruling from the Court of Appeal for Ontario, Daniel Tiffin was initially acquitted on charges of securities violations in the Ontario Court of Justice.

That acquittal was overturned on appeal to the Superior Court of Justice, which substituted convictions and ordered Tiffin to serve six months in jail, along with 24 months of probation and a restitution order.

Tiffin, in turn, appealed both his conviction and the court’s sentence.

According to the appeal court ruling, Tiffin borrowed $700,000 from several clients and friends in exchange for promissory notes.

“The notes provided for annual interest rates ranging from 10% to 25% and stated that they were secured against a ‘toy soldier collection’ owned by [Tiffin’s company, Tiffin Financial Corp.],” the court said.

The Ontario Securities Commission (OSC) — which prohibited Tiffin from trading for five years in 2009 for improperly soliciting investments in Rezwealth Financial Services Inc. — charged Tiffin with securities offences, including trading securities without registration, distributing securities without a prospectus and trading securities while prohibited.

The central issue in the case was whether the promissory notes were considered securities.

The original trial judge ruled that they were not, but the Superior Court of Justice disagreed.

Now, the appeal court has upheld the second judge’s decision, dismissing the appeal from the convictions.

“The definition of security adopted by the appeal judge is supported both by the plain text of the [Securities Act] and the logic of the regulatory scheme,” the appeal court said in its decision.

However, the court did allow the sentence appeal.

“While it was not an error in law to impose a custodial sentence per se, the sentence arrived at by the sentencing judge is demonstrably unfit,” the court said.

The appeal court cited a number of factors for this conclusion, including that Tiffin did not attempt to deceive his lenders, he expressed remorse, he is making efforts to repay the lenders and five recipients of the promissory notes filed letters of support for him.

As a result, the court set aside the jail term, but upheld the 24-month probation order and the restitution order.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.