Decision in brief: Stinson, Enforcement Proceeding, Sanctions and Costs, December 15, 2023

Citation and CanLII link
Cathy Singer (chair of the panel), Sandra Blake, Geoffrey D. Creighton
Date of Reasons:
File Number:
Hearing Type:
Sanctions and Costs
Applicants / Respondents:
Harry Stinson, Buffalo Grand Hotel Inc., Stinson Hospitality Management Inc., Stinson Hospitality Corp., Restoration Funding Corporation, Buffalo Central LLC and Stephen Kelley

In an earlier decision, the Tribunal decided that Harry Stinson and his companies violated Ontario securities law when they raised money from investors to fund a hotel development project. They did not file a prospectus for the securities they sold to investors. A prospectus is a document that provides information about the investment to investors. Stinson and one of his companies did not stop trading as they were required to do by a Tribunal order. Finally, none of them kept proper and accurate records of the money raised from investors.

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. While their misconduct was not fraud, it was serious. Stinson should have known better because he has been sanctioned for similar conduct in the past. The ban the Tribunal imposed will still allow Stinson to be a director and officer of his real estate brokerage.

The Tribunal decided that the respondents, other than one company who had less involvement, must jointly pay an administrative penalty of $600,000, and must jointly disgorge (give up to the Commission) all the money they raised from investors. The Tribunal rejected the respondents’ request that they be allowed three years to restore and sell the hotel and repay investors before being required to disgorge what was not repaid. There was not enough proof of when or if this would happen.

Finally, the Tribunal decided that the respondents must jointly pay $166,000 in costs to the Commission. The amount OSC staff asked for was reduced to reflect the respondents’ cooperation, and because time was spent on allegations against another person who settled and on allegations against the respondents that staff did not prove.

Decisions in brief are prepared by Governance & Tribunal Secretariat staff to help the public better understand Tribunal decisions. They do not form part of the Tribunal’s reasons and are not for use in legal proceedings.