Tribunal dismisses Bridging CCO’s bid for expedited hearing

There’s no easy way to expedite a hearing against the former chief compliance officer of failed fund manager Bridging Finance Inc. (BFI), Ontario’s Capital Markets Tribunal has ruled.

Andrew Mushore, the former CCO of Bridging, is facing a series of enforcement allegations from the Ontario Securities Commission (OSC) alongside the firm’s founders, David and Natasha Sharpe, including allegations of securities fraud and misleading OSC staff.

The allegations of misconduct followed the collapse of Bridging, which is expected to result in more than $1 billion in investor losses once the receivership of the firm and its funds runs its course.

None of the allegations have been proven.

Ahead of the hearing into the allegations, which is scheduled to begin on May 23, Mushore requested the tribunal expedite the portion of the proceedings involving the allegations against him — citing the cost of participating in a complex hearing that is scheduled to run for 35 days, ultimately ending in mid-December.

“Mushore submitted that he does not have the resources to have his counsel participate fully in that merits hearing,” the tribunal noted in its decision. “He asked the tribunal to provide a mechanism that would separate, in some way, the portion of the merits hearing that addresses the allegations against him.”

The motion was opposed by both OSC staff and the Sharpes.

The tribunal agreed, ruling that it’s not possible to expedite the hearing against Mushore alone. The reasons noted included that the allegations against him can’t be separated from the charges against the other respondents; that Mushore’s evidence will surely be contested at the hearing; and that “none of the mechanisms that Mushore proposed would appropriately balance his interests with those of the other parties.”

“Any separate merits hearing would be impractical and would likely require duplication of effort, given that the allegations against Mushore are so intertwined with the allegations against the other respondents, and given that Mushore is, in some respects, adverse in interest to the Sharpes,” the tribunal said.

“Under those circumstances, a separate merits hearing would be contrary to, rather than consistent with, the objective of an expeditious and cost-effective proceeding,” it ruled.

While the panel dismissed Mushore’s motion, it suggested there may be ways to cushion the costs of his participation.

“During the motion hearing, [OSC] staff committed to being willing to consider workable and appropriate accommodations to assist Mushore and the other respondents, in order to secure a just, expeditious and cost-effective merits hearing,” the tribunal said. It added that the various participants should be “as transparent as possible about when various witnesses will testify, and when certain topics will be covered,” so Mushore and his counsel can decide when they need to participate in the hearing.

James Langton

James is a senior reporter for Advisor.ca and its sister publication, Investment Executive. He has been reporting on regulation, securities law, industry news and more since 1994.