Settlement curbs broker’s private lending as regulators tighten scrutiny of high‑cost deals
The Financial Services Regulatory Authority of Ontario (FSRA) has put strict limits on the business of Mississauga mortgage broker Rahman Mohammed after finding he arranged an expensive private mortgage through an unlicensed intermediary and failed to verify his borrower’s identity or assess whether the loan was suitable.
Mohammed, principal broker and sole director of Wisheskept Mortgage Group Inc., admitted breaching several provisions of Ontario’s Mortgage Brokerages, Lenders and Administrators Act in connection with a 2020 private deal known as the MJA mortgage.
According to FSRA’s enforcement record, Mohammed arranged a $100,000 mortgage for borrower MJA at “an interest rate of 10% per month on a two‑month term” with a $15,000 consultant fee on top.
The stated cost of borrowing was 141% annually, or 231% when the consultant’s fee was included, leaving the borrower with about $61,483 of the original advance after costs. FSRA said the mortgage was secured against two properties even though one had sufficient equity on its own.
FSRA found that Mohammed relied on lawyers and an unlicensed referrer, Iftikhar Qadeer, to handle borrower contact and documentation, and that MJA “did not know that Mohammed was her mortgage broker.”
The regulator concluded that he failed to verify her identity, failed to take reasonable steps to ensure the mortgage was suitable and “facilitated Qadeer’s dishonesty and illegal conduct of dealing in mortgages without a licence.”
Under the settlement, Mohammed agreed to $15,000 in administrative penalties and a two‑year ban on dealing in private mortgages. He also agreed that he and Wisheskept would “only deal in mortgage transactions with institutional lenders” for two years, and that he would complete a private mortgages course within the same period.
The case landed as FSRA continues to sharpen its focus on suitability, vulnerable consumers and high‑cost private deals. In separate guidance, the regulator has stressed that it “assesses whether applicants, agents and brokers are suitable for licensing” and takes action where their conduct raises concerns about fair treatment of customers.
Private lenders and mortgage investment entities have played a growing role in Ontario’s market, offering flexibility but also exposing borrowers to higher rates, layered fees and shorter terms.
Industry groups have noted that FSRA “is very actively focussing regulatory initiatives on private mortgage lending,” including new product suitability expectations and audits targeting cost‑of‑credit disclosure and accurate APR calculations.
For brokers, the Mohammed settlement underscores how quickly individual conduct issues could escalate into questions of licensing suitability and business model. FSRA has framed such actions as part of its mandate to ensure consumers receive “competent and ethical mortgage brokering services” and that principal brokers, in particular, maintain robust screening, oversight and documentation around private deals.
Ontario remained at the centre of Canada’s regulated mortgage industry, with FSRA overseeing “over 16,000 mortgage professionals and 1,178 brokerages” as of March 31, 2025. Canadian Mortgage Professional has previously reported on how that scale, coupled with rapid growth in non‑bank and private lending, has made the province a testing ground for more intensive supervision of brokers’ suitability assessments and client‑outcomes.
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