OSC Lays Several Criminal and Quasi-Criminal Charges in Hospital Privacy Breach Case

TORONTO – The Ontario Securities Commission (OSC) announced a series of criminal and quasi-criminal charges today following an investigation by the OSC’s Joint Serious Offences Team (JSOT) related to the misuse of confidential patient information from the Rouge Valley Health System and the Scarborough Hospital.

It is alleged that former Global RESP Corporation (Global) sales representative Nellie Acar had purchased stolen maternity patient labels from registered nurse Esther Cruz over an approximate two-and-a-half-year period. Cruz was formerly employed in the maternity departments of the two hospitals. Acar allegedly used this confidential patient information as a source of potential Registered Education Savings Plan (RESP) investment sales leads. On at least two occasions, Acar allegedly completed and submitted false Global Educational Trust Foundation Education Savings Plan Enrollment Applications through Global.

Acar has been charged with the following alleged breaches of the Criminal Code of Canada (Criminal Code):

1. Two counts of secret commissions contrary to s. 426(1)(a) of the Criminal Code
2. Two counts of forgery contrary to s. 366(1) of the Criminal Code
3. Two counts of uttering a forged document contrary to s. 368(1)(b) of the Criminal Code
4. Two counts of possession of property obtained by crime under $5000 contrary to s. 354(1) of the Criminal Code

Cruz has been charged with the following alleged breaches of the Criminal Code:

1. Two counts of secret commissions contrary to s. 426(1)(a) of the Criminal Code
2. Two counts of breach of trust by a public officer contrary to s. 122 of the Criminal Code
3. Two counts of theft under $5000 contrary to s. 334 of the Criminal Code

The JSOT investigation further alleges that former Knowledge First Financial Inc. (KFFI) branch manager Poly Edry purchased confidential maternity information over an approximate five-year period from former Rouge Valley Hospital clerk Shaida Bandali, who was previously charged in November 2014 with unregistered trading, contrary to s. 25(1) of the Securities Act (Ontario). Former C.S.T. Consultants Inc. assistant branch manager Subramaniam Sulur is also alleged to have purchased confidential maternity information from Bandali over an approximate two-year period.

Edry and Sulur allegedly provided this confidential information to sales representatives at their former firms as a source of potential RESP investment sales leads.

Poly Edry and Sulur have been charged with the following alleged breaches of the Securities Act:

1. One count of failing to act fairly, honestly and in good faith with clients, contrary to OSC Rule 31-505 and contrary to s. 122(1) of the Securities Act
2. One count of participating in an unlawful referral arrangement with another person, contrary to National Instrument 31-103 and contrary to s.122(1) of the Securities Act

Gavriel Edry allegedly assisted his spouse Poly with the gathering and dissemination of confidential maternity information to KFFI sales representatives and has been charged with one count of unregistered trading, contrary to s. 25(1) of the Securities Act.  

The first court appearance for Acar and Cruz in this matter is scheduled to take place on July 17, 2015 at 2:00 p.m. in Courtroom #407 at the Ontario Court of Justice, 1911 Eglinton Avenue East, Toronto, Ontario.

The first court appearance for Poly Edry, Gavriel Edry and Sulur in this matter is scheduled to take place on July 16, 2015 at 11:00 a.m. in Courtroom #111 at the Old City Hall – Ontario Court of Justice, 60 Queen Street West, Toronto, Ontario.

JSOT acknowledges the cooperation and assistance to their investigation by the Rouge Valley Health System and the Scarborough Hospital.

JSOT was established by the OSC as an enforcement partnership between the OSC, the Royal Canadian Mounted Police Financial Crime program and the Ontario Provincial Police Anti-Rackets Branch. The primary objective of JSOT is to protect investors and further enhance confidence in the Canadian capital markets through effective enforcement. This is accomplished through collaborative investigations of serious violations of the law using the provisions of the Securities Act or the Criminal Code. 

The mandate of the OSC is to provide protection to investors from unfair, improper or fraudulent practices and to foster fair and efficient capital markets and confidence in the capital markets. Investors are urged to check the registration of any persons or company offering an investment opportunity and to review the OSC investor materials available at www.osc.ca

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