He allegedly misled investors about mortgage investments and lied on licence applications
An Ontario broker and brokerage could face the loss of their mortgage licences after the province’s financial services regulator initiated enforcement action and alleged that neither were suitable for licensing.
The Financial Services Regulatory Authority of Ontario (FSRA) has accused Michael Ryland Slattery and Skylark Holdings Limited of serious misconduct and providing false information, potentially jeopardizing his ability to operate as a mortgage broker.
FSRA’s investigation alleges that Slattery, previously licensed as a mortgage broker until the end of March, was involved in deceptive mortgage investment transactions and other misconduct while he operated two private mortgage companies, Merk Investments Ltd. and Skylark Finance Corporation.
"Slattery's conduct has led us to believe that he will not deal or trade in mortgages by the law and with integrity and honesty," the regulator stated in its notice of proposal.
FSRA is moving to refuse Slattery's mortgage broker licence renewal and revoke the license issued to Skylark Holdings.
Deceptive mortgage practices
Slattery was the sole director, officer, and principal broker of Skylark Holdings, as well as the CEO of Merk and Skylark. Merk primarily managed and administered mortgages arranged by Skylark, while Skylark provided financing and leasing for home renovations and other systems.
A complaint from an investor revealed that his corporations invested in several mortgage transactions through Merk and Skylark between July 2013 and December 2018.
Despite these mortgages being discharged, Merk and Skylark allegedly continued to issue false monthly statements and interest payments, misleading MO into believing the mortgages were still active.
Between March 2015 and May 2022, at least six mortgages totalling $3.687 million were discharged. However, as late as June 2022, Merk and Skylark allegedly provided false statements and interest payments. This deceptive practice is said to have continued even though the mortgages had been removed from the property titles.
In March 2024, Slattery was charged with multiple offences related to these deceptive mortgage practices under the Criminal Code.
License renewal applications
Slattery allegedly provided false information on three consecutive licence renewal applications, each time swearing to the truthfulness of his statements.
In his 2024 application, filed just two weeks after his arrest, Slattery claimed he wasn't subject to any charges or investigations.
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His 2023 application omitted mention of the civil lawsuit against him, while his 2022 application falsely stated he had never declared bankruptcy – a claim contradicted by his own previous disclosures.
FSRA is now moving to refuse the renewal of Slattery's mortgage broker licence and revoke Skylark's mortgage brokerage license. The regulator cited Slattery's past conduct as grounds for belief that he "will not deal or trade in mortgages by the law and with integrity and honesty."
Slattery and Skylark requested a hearing about this proposal before the Financial Services Tribunal.
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