TORONTO ONTARIO, – Home Capital Group (TSX:HCG) is benching two of the key figures at the centre of allegations filed against the mortgage lender last week by Ontario’s securities watchdog.
The Toronto-based company says its current chief financial officer, Robert Morton, will be assigned new responsibilities after first-quarter results are filed next month.
It also says Home Capital founder Gerald Soloway, who was formerly the company’s chief executive officer, will step down from the board of directors once a replacement is found — but run for re-election at the May 11 shareholders meeting.
Morton, Soloway and former CEO Martin Reid are facing allegations of misleading Home Capital’s shareholders through financial statements and conference call comments in 2015. Home Capital was also named in the statement of allegations by the Ontario Securities Commission
The company has said the allegations against it are without merit and that it will defend itself vigorously. Previously reached by telephone, Reid has declined to comment on the allegations.
The company’s stock lost one-fifth of its value on Thursday, closing at its lowest since August 2009, but recovered some of its losses the following day to close at $19.25 — down nearly 14 per cent over two days.
Home Capital says its interim chief financial officer will be Robert Blowes, who was Home Capital’s CFO from 2012 to 2014.
