The Financial Services Regulatory Authority of Ontario has imposed administrative monetary penalties of CAD 60,000 on Harold Gerstel and CAD 150,000 on Esther Gerstel Inc, and issued a compliance order restricting EGI from the business of mortgage lending unless it complies with the law. The action follows a contested hearing in which the Financial Services Tribunal found that Gerstel dealt in mortgages for remuneration outside his brokerage when arranging mortgages for EGI, and that EGI carried on business as a private mortgage lender in Ontario without being licensed or exempt from licensing under the Mortgage Brokerages, Lenders and Administrators Act, 2006. The Tribunal found that borrowers suffered significant harm and that Gerstel and EGI acted intentionally and recklessly while receiving economic benefits. Gerstel, described as an experienced mortgage broker and principal broker, dealt in mortgages for remuneration with six borrowers who were not clients of his brokerage, Harold the Mortgage Closer Inc, referred all six exclusively to EGI for private loans, and then dealt with the borrowers on behalf of EGI, denying them protections under the Act including suitability assessment. FSRA said the orders were issued as a result of the Tribunal’s decision in Harold Gerstel, Harold the Mortgage Closer Inc and Esther Gerstel Inc v Ontario (CEO of FSRA). Separately, FSRA had previously revoked and refused the licences of Gerstel and Harold the Mortgage Closer Inc and imposed CAD 70,000 in penalties for failing to cooperate with its investigation and providing false information, and that earlier decision is before the Court on judicial review.
Financial Services Regulatory Authority of Ontario 2026-04-28
Financial Services Regulatory Authority of Ontario imposes CAD 210000 in penalties and restricts Esther Gerstel Inc mortgage lending after licensing breaches
The Financial Services Regulatory Authority of Ontario has imposed penalties of CAD 60,000 on Harold Gerstel and CAD 150,000 on Esther Gerstel Inc, and issued a compliance order restricting Esther Gerstel Inc from mortgage lending unless it complies with the law. A Financial Services Tribunal found Gerstel dealt in mortgages for remuneration outside his brokerage and that Esther Gerstel Inc operated as an unlicensed private mortgage lender, causing significant harm to borrowers and denying them protections under the Mortgage Brokerages, Lenders and Administrators Act, 2006. FSRA said this enforcement follows an earlier decision revoking and refusing licences of Gerstel and his brokerage and imposing CAD 70,000 in penalties, which is under judicial review.