Scotiabank, Yonge Street, Toronto, Ontario

Conservatory Measures

What is a conservatory measure?

The Superintendent of Bankruptcy puts in place conservatory measures when a bankruptcy or insolvency estate needs protection. It might be in cases of Licensed Insolvency Trustee (LIT) malfeasance or if serious wrongdoing on the part of a LIT puts estate files at risk. Conservatory measures may also be put in place if a LIT becomes ill or dies without a valid succession agreement. Finally, conservatory measures may be put in place if a LIT, for whatever reason, has allowed the administration of his or her practice to become substandard.

Scotiabank
6416 Yonge St.
Toronto, ON
M2M 3X4
Canada

In the matter of:
Oscar Wald, CMA,
holder of an individual trustee license


Directions for Conservatory Measures
(Section 14.03 of the Bankruptcy and Insolvency Act)


Whereas the Bankruptcy and Insolvency Act (the Act) provides the Superintendent of Bankruptcy (the Superintendent) with the general power to supervise the administration of all estates and matters to which the Act applies;

Whereas Oscar Wald is the holder of an individual license as trustee in bankruptcy;

Whereas an investigation made by the Superintendent pursuant to section 5(3)(e) of the Act revealed that Oscar Wald (the trustee) had a number of deficiencies in his accounting system and in the general administration of his estates;

Whereas a Monitoring Review was commenced in December 2004 and a Monitoring Report was issued on March 24, 2005 and documents the following serious deficiencies with respect to the administration of estates:

  • the accounting system of the Trustee is unreliable and is not in compliance with the requirements of Directive 5R–Estate Funds and Banking;
  • the Trustee has failed to adequately monitor Division II (Consumer) Proposals for receipt of payments, with the result that a significant number were deemed annulled pursuant to s. 66.31(1) of the Act;
  • the Trustee did not issue the required Notices of Deemed Annulment in a significant number of estates, pursuant to s. 66.31(1)(a) of the Act;
  • the Trustee omitted to pay dividends as required pursuant to s. 66.26(1) of the Act;
  • the Trustee had aged inventory of 100% open Ordinary Administration estates and 42% of open Summary Administration estates;
  • to date the Trustee has failed to submit a closing plan for the aged estates which is satisfactory to the OSB;

Whereas deficiencies regarding the Trustee's accounting system have been raised as concerns in a Monitoring Report dated November 4, 1999 and an Audit Report issued in September 2000;

Whereas the A/Division Assistant Superintendent has addressed these deficiencies with the Trustee via letters dated May 3, June 22, July 6 and July 7, 2005;

Whereas the Senior Bankruptcy Analyst and the A/Division Assistant Superintendent met with the Trustee regarding these deficiencies on May 18, June 2 and July 8, 2005;

Whereas the above cited deficiencies persist and the Trustee has provided no reasonable proposal for remedying them in a timely fashion;

Whereas I believe on reasonable grounds that the estates require protection;

Whereas the Superintendent may, for the protection of an estate, exercise the powers set out in subsection 14.03(1) of the Act, in the circumstances referred to in section 14.03(2) of the Act;

Whereas the Superintendent has delegated to me, in accordance with section 14.01(2) of the Act, the powers of the Superintendent as specified at section 14.03(1) of the Act, in the circumstance referred to in section 14.03(2)(b), a copy of which delegation is attached, along with copies of sections 14.01, 14.02 and 14.03 of the Act;

I, Ann Speers, in my capacity as delegate for the Superintendent, direct Scotiabank as follows:

That, pursuant to sections 14.03(1)(b) and (c) of the Act,

  1. provide, by close of business on July 29, 2005, a list of estate trust bank accounts in the name of, administered by or in any other way in the control of Oscar Wald to Ann Speers, Office of the Superintendent of Bankruptcy, 25 St. Clair Avenue East, Suite 600, Toronto, Ontario, M4T 1M2;
  2. to consider upon receipt of the present directions, Emily Beckerman and Abubakar Khan, employees of the Office of the Superintendent of Bankruptcy, as the only two authorized co-signatories as relate to any operations of the funds credited to the estates of bankruptcies and proposals administered by Oscar Wald;
  3. make no debit, payment or transfer of funds credited to, or which ought to have been credited to, the estates of bankruptcies and proposals administered by Oscar Wald the countersignature of either Emily Beckerman or Abubakar Khan;
  4. not pay out of these accounts: cheques, bills of exchange, bank drafts or other instruments, issued before the receipt of these directions which are presented for payment after the receipt of these directions, without these cheques, bills of exchange, bank drafts or other instruments being countersigned by either Emily Beckerman or Abubakar Khan;
  5. submit all statement of accounts, accepted cheques and other documents or information having to do with the above-mentioned estate trust bank accounts, to Ann Speers, Office of the Superintendent of Bankruptcy, 25 St. Clair Avenue East, Suite 600, Toronto, Ontario, M4T 1M2;

That these directions take effect immediately and will stay in place until such time as I am satisfied that the estates no longer require protection or until a decision is made under subsection 13.2(5) or 14.01(1) of the Act;

That in accordance with section 14.03(3) of the Act, these directions bind the Scotiabank, which must comply with them;

That in accordance with section 14.03(4) of the Act, a person who complies with these directions is not liable for any act done by that person only to comply with these directions.

Signed at the City of Toronto Ontario, this 18th day of July, 2005.

Ann Speers

This document has been reproduced as submitted by the delegate of the Superintendent of Bankruptcy.
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