Principal broker supervised deals with APRs above 23%
Ontario’s financial services regulator is proposing to revoke the mortgage brokerage licence of Quick Cash Mortgage (QC Mortgage) and refuse the licence renewal of its principal broker, Joel Kelman, after uncovering a series of regulatory violations involving high-cost private mortgages issued to vulnerable seniors.
The Financial Services Regulatory Authority of Ontario (FSRA) alleges that Kelman, also the sole director of QC Mortgage and former principal broker of The Mortgage Maven Inc., failed in his supervisory duties and contravened several sections of the Mortgage Brokerages, Lenders and Administrators Act, 2006.
Among the violations was brokering loans with annual percentage rates (APRs) exceeding 23% for senior citizens on fixed incomes.
Between May and November 2022, under Kelman’s supervision at Mortgage Maven, agent Aid Almusri arranged four private mortgages for three elderly clients, identified as LA/SA, MW/JK, and JR. These short-term loans, ranging from $300,000 to $940,000, carried APRs between 21.95% and 23.46%. The entire loan principal was due at the end of each term.
The FSRA’s findings revealed that the borrowers, all retired and earning annual incomes between $20,000 and $25,000, were left with repayment obligations that exceeded or nearly matched their monthly incomes. Additionally, the mortgages were secured against their homes—their main financial assets, amplifying the risks of default.
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Kelman signed off on the Suitability Forms and disclosure documents, despite some forms including false information or omitting borrower liabilities. In one case, borrower JK claimed she was unaware she had agreed to a mortgage at all. Another borrower, SA, told FSRA he had no recollection of applying for a mortgage or dealing with Kelman or his firm.
Mortgage Maven collected $204,900 in brokerage fees from the proceeds of these mortgages.
Kelman is accused of breaching key compliance requirements. FSRA alleges he failed to:
- Ensure the suitability of the mortgages for the borrowers' financial situations;
- Disclose material risks specific to the loans;
- Declare conflicts of interest, especially concerning Almusri's ties to Canada’s Choice Capital (CCC), which had interests registered on one borrower’s home;
- Maintain complete records, including documentation and communications with lenders;
- Provide truthful information in his 2024 and 2025 licence renewal applications, where he allegedly denied involvement in ongoing civil litigation.
“Kelman was, or ought to have been cognizant of the circumstances surrounding the Borrowers’ mortgage” but instead “facilitated the transactions by liaising with lenders,” FSRA said in its notice of proposal.
FSRA is seeking to impose $120,000 in administrative penalties on Kelman and to revoke QC Mortgage’s brokerage licence due to concerns about Kelman's integrity and compliance history. The regulator argues that Kelman’s conduct provides “reasonable grounds for belief that the business of the corporation will not be carried on in accordance with the law and with integrity and honesty.”
Both Kelman and QC Mortgage have requested a hearing before the Financial Services Tribunal to contest FSRA’s findings.
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