Court-appointed receiver to untangle lawsuits, alleged financial misconduct
Sussman Mortgage Funding Inc. (SMFI), a former Ontario-licensed mortgage broker and administrator, has been placed into receivership a court order tied to multiple investor lawsuits and alleged financial misconduct.
The Ontario Superior Court of Justice appointed B. Riley Farber Inc. on May 2, as the official receiver over SMFI and two connected companies, 2486976 Ontario Inc. and 1981361 Ontario Inc. This came after an application from Ontario’s Financial Services Regulatory Authority (FSRA), which cited multiple legal proceedings from mortgage investors and concerns over how the company was handling funds.
According to FSRA, SMFI stopped making interest payments to investors, failed to repay loans, didn’t register certain mortgages, and even discharged some mortgages without notifying investors or paying back related loans. As of March 31, SMFI no longer had any licensed mortgage brokers, and its licenses as a broker and administrator have now been revoked.
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The appointed receiver, B. Riley Farber, has been authorized to manage all of SMFI’s assets, properties, and undertakings, investigate financial transactions, and oversee any related mortgage loans or agreements.
The receiver will look specifically at the company’s syndicated mortgages and joint venture deals, which include various residential development projects across Ontario in places like Innisfil, Mara, and Muskoka.
For now, the court has capped the receiver’s initial fees at $300,000, with any extra costs requiring further approval. B. Riley Farber is also allowed to bring in consultants or legal support as needed to sort through the company’s financial and legal mess.
The receiver is required to file a preliminary report with the court within 30 days, with a follow-up case conference scheduled for June 26, 2025. Anyone involved or affected can follow developments and access court filings on the official case website.
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