IN THE MATTER OF THE SECURITIES ACT,
R.S.O. 1990, c. S.5, AS AMENDED
- and -
IN THE MATTER OF
PAUL CAMILLO DINARDO
STATEMENT OF ALLEGATIONS
OF STAFF OF THE ONTARIO SECURITIES COMMISSION
Staff of the Ontario Securities Commission (“Staff”) allege:
- On February 27, 2015, Paul Camillo DiNardo (“DiNardo”) pleaded guilty in the Ontario Superior Court of Justice (the “Superior Court”) to, among other charges, 2 counts of fraud over $5,000, contrary to section 380(1) of the Criminal Code, R.S.C., 1985, c. C-46 (the “Criminal Code”). DiNardo’s guilty plea was accepted by the Superior Court, and on April 15, 2015, DiNardo was sentenced to 5 years in prison, less 2 years and 10 months for pretrial credit, resulting in a net effective sentence of 2 years and 2 months.
- The offences for which DiNardo was convicted arose from transactions, business or a course of conduct related to securities.
- Staff are seeking an inter-jurisdictional enforcement order reciprocating DiNardo’s convictions, pursuant to paragraph 1 of subsection 127(10) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the “Act”).
- The conduct for which DiNardo was sanctioned took place between April 2005 and January 2012 (the “Material Time”).
II. THE RESPONDENT
- DiNardo is a resident of Ontario.
- DiNardo has never been registered with the Ontario Securities Commission (the “Commission”) in any capacity.
- On February 27, 2015, DiNardo pleaded guilty in the Superior Court in relation to 2 counts of fraud for his role in several investment schemes, involving various companies, during the Material Time. None of the companies were registered to trade with the Commission.
- In respect of the first set of charges, between April 5, 2005 and November 29, 2010, approximately 160 individuals were recruited to invest approximately $13 million, of which approximately $6 million was repaid to investors. DiNardo, among others, solicited investments, whereby investors were told they were investing in oil and real estate which would yield high rates of return.
- In respect of the second set of charges, between September 7, 2011 and January 12, 2012, DiNardo convinced his 86 year old physician to provide him with $1.1 million, purportedly for an investment with a high rate of return in a company called North American Carrier Services. Of the $1.1 million provided to DiNardo, $32,500 was repaid and the remaining amount of $1,067,500 was outstanding as of April 15, 2015.
III. THE SUPERIOR COURT OF JUSTICE PROCEEDINGS
DiNardo’s Conviction for Fraud
- By Indictments sworn February 27, 2014 (the “Indictment”) and February 23, 2015 (the “Second Indictment”), DiNardo was charged with 5 various counts of contravening the Criminal Code.
- On February 27, 2015, DiNardo pleaded guilty to each of the 5 counts, including 2 counts of fraud over $5,000, contrary to section 380(1) of the Criminal Code, being count 1 of the Indictment and count 1 of the Second Indictment.
- A sentencing hearing was subsequently held on April 15, 2015 before the Honourable Justice Wein of the Superior Court. Justice Wein issued oral reasons and sentenced DiNardo to a term of imprisonment of 5 years, less 2 years and 10 months for pretrial credit, resulting in a net effective sentence of 2 years and 2 months.
IV. JURISDICTION OF THE ONTARIO SECURITIES COMMISSION
- Pursuant to paragraph 1 of subsection 127(10) of the Act, DiNardo’s convictions for offences arising from transactions, business or a course of conduct related to securities or derivatives may form the basis for an order in the public interest made under subsection 127(1) of the Act.
- Staff allege that it is in the public interest to make an order against DiNardo.
- Staff reserve the right to amend these allegations and to make such further and other allegations as Staff deem fit and the Commission may permit.
- Staff request that this application be heard by way of a written hearing pursuant to Rules 2.6 and 11 of the Ontario Securities Commission Rules of Procedure, (2014) 37 OSCB 4168.
DATED at Toronto, this 17th day of August, 2015.