B.C. company funded 47 mortgages over 6 years despite not being registered to do so

(Source: Andrea Piacquadio/Pexels)

A company with “mortgage” in its name was not actually authorized to fund the dozens of property-backed loans it issued over a six-year period from 2017 to 2023, according to the regulator of the industry in B.C.

Dawn Creek Mortgage Investment Corp. “has never been registered as a mortgage broker or submortgage broker” under the provincial Mortgage Brokers Act, according to a consent order it entered with the B.C. Financial Services Authority last month.

Despite this, the Richmond-based company “carried on a business of lending money secured in whole or in part by mortgages” for years, according to the order, which was published online last week.

The document includes a redacted list of 47 loans Dawn Creek made between 2017 and 2023. While the addresses of properties the mortgages were secured against are not listed, the values of the loans ranged from as little as $40,000 to as much as $2.3 million.

The total value of the 47 loans, as listed in the consent order, was more than $21.3 million.

The company made five loans in 2017, six each in 2019 and 2022 and nine each in 2018, 2020 and 2021, according to the consent order. In 2023, the company made just three loans. The BCFSA sent it a summons in November of that year.

According to the consent order, Dawn Creek never arranged mortgages on behalf of third-party lenders, always using its own funds when providing financing to its individual and corporate borrowers.

The document indicates that neither Dawn Creek nor its sole director Le Zeng was aware that providing loans in this manner constituted unregistered mortgage broker activity as defined under the act.

Zeng and his company “fully co-operated” with the regulator’s investigation, according to the consent order.

Under the order, Dawn Creek agreed to pay the regulator a $30,000 administrative penalty, as well as $5,000 in investigation costs.