The Financial Services Regulatory Authority of Ontario (FSRA) has fined a real estate developer for multiple contraventions of the mortgage brokers act related to syndicated mortgages, the regulator said in a release on Thursday.
Richmond Hill, Ont.–based Fortress Real Developments Inc. must pay an administrative penalty of $250,000 as part of a settlement agreement, the release said.
FSRA said it found a dozen contraventions of the Mortgage Brokerages, Lenders and Administrators Act related to Fortress providing services to borrowers for the purpose of financing property developments while Fortress wasn’t licensed to do so.
Fortress has never been licensed under the act.
Between 2009 and 2018, Fortress and its predecessor Fortress Real Capital Inc. helped borrowers connect to mortgage brokers and administrators, which allowed these brokers to raise over $900 million in syndicated mortgage loans, FSRA said.
Fortress has 30 days after receiving FSRA’s invoice to pay the penalty.
In 2018, the Financial Services Commission on Ontario, FSRA’s predecessor, issued orders against eight parties involved with syndicated mortgage investments for projects developed by Fortress. Under the orders, four mortgage brokerages that facilitated the syndicated mortgage transactions that funded Fortress projects were handed $1.1 million in administrative penalties.