February 2, 2018 / 2:52 PM / a year ago

CORRECTED-UPDATE 1-Ontario regulator revokes mortgage broker BDMC license after probe

(Corrects amount of fines to C$1.1 million not C$1.1 billion)

TORONTO, Feb 2 (Reuters) - Ontario’s financial regulator said on Friday it has revoked the license of mortgage brokerage Building Development and Mortgages Canada Inc (BDMC) and Vince Petrozza, a co-founder of a related firm, Fortress Real Developments, following an investigation into risky syndicated mortgage investments.

FSCO said BDMC, the lead broker for Fortress projects, and three mortgage brokers - FDS Broker Services Inc, FFM Capital Inc and FMP Mortgage Investments Inc - which marketed Fortress products as their primary or sole line of business - were fined a total of C$1.1 million.

In a special report published in November, Reuters revealed the Financial Services Commission of Ontario (FSCO) had been investigating brokers raising funds for projects associated with Fortress since 2011 but had failed to take action despite repeated warnings of the risky investments that broke provincial laws.

The regulator revoked the broker licenses of Petrozza and three other individuals, requiring them to stop all mortgage brokering businesses immediately.

Ildina Galati-Ferranti, principle broker of BDMC, surrendered her broker license and was required to cease all mortgage brokering activities. (Reporting by Matt Scuffham; Editing by Jeffrey Benkoe)

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