TDWaterhouse to appear at OSC

Representatives of TD Waterhouse Canada are to appear before the Ontario Securities Commission on Sept. 30 to settle allegations the broker was involved in an RRSP loan scheme.

Terms of a settlement agreement reached with OSC staff are confidential until approved by the full commission, the regulator said in a statement yesterday.

According to a statement of allegations filed by OSC staff, TD Waterhouse set up accounts and transferred shares in a numbered company that, unknown to the broker, were exchanged for nonrepayable loans. The OSC staff also alleged TD did not disclose a 7% commission it received.

TDWaterhouse Canada officials were unaware that there were to be loans associated with the investment, or that the investment was designed to allow investors to withdraw assets from their lockedin RRSPs. However, TD Waterhouse Canada’s compliance department was aware the OSC had issued an RRSP loan scheme alert, the regulator’s staff allege.

According to the OSC’s statement of allegations, Richard Ochnik, an Ontario resident \not affiliated with TDWaterhouse, approached the broker in February, 2002, to set up the accounts and transfer the shares of the numbered company to those accounts. The numbered company was to develop a property as a retirement complex in Listowel, Ont.

Between June 7, 2002, and Dec. 31, 2002, 43 clients deposited at least $1.5-million into their accounts at TDWaterhouse in exchange for shares, according to the OSC allegations. TD Waterhouse received $ 105,560 in commissions.

A spokeswoman for TDWaterhouse Canada declined to comment on the matter yesterday.