TORONTO – A Toronto man was accused on Monday by the Ontario Securities Commission of illegally selling some $90 million in securities to investors before his businesses went bankrupt.
The provincial regulator said some $38 million remains outstanding to investors.
In a statement of allegations, the OSC said Eric Inspektor raised the money between January 2005 and September 2011 through the issuance and unregistered sale of short and long term debentures, convertible term debentures, co-tenancy agreements, share purchase agreements and promissory notes.
“Through their dealings with Inspektor, investors were led to believe that the Kaptor Group was investing in various business activities within the Kaptor Group which would generate substantial rates of return and would generally yield investors returns between 15 per cent and 36 per cent annually,” the OSC said.
Most of the money raised was in conjunction with CarCap and CarCap Auto Finance, which provided sub-prime car leasing financing and sub-prime auto loans.
The companies were placed into receivership in December 2011 at the request of a secured institutional creditor.
Money raised also went to a business that the regulator said held itself out as a wholesaler and distributor of licensed household products.
Kaptor Financial was placed in receivership in May 2012.
The OSC allegations have not been proven.