News Releases
Notice of Hearing issued regarding allegations of Jay Modi, Arti Modi, Rajeev Singh and OmniArch Capital Corporation perpetrating a fraud and misleading investors
Apr 11, 2019
CALGARY – April 11, 2019 - A Notice of Hearing has been issued by the Alberta Securities Commission (ASC) against OmniArch Capital Corporation, Jay Rasik Modi, Arti Rajeev Singh, also known as Arti Rajeev Modi (Arti Modi), and Rajeev Jagdish Singh in connection with the diversion of approximately $10 million in investors’ funds to companies owned and controlled by directors of OmniArch.
In the Notice of Hearing, it is alleged that Jay Modi, Arti Modi and Rajeev Singh, the directors, knew or ought to have known that funds allocated by OmniArch to purchase securities on behalf of investors were instead paid to related companies controlled by OmniArch’s directors. It is also alleged that OmniArch mislead investors about its experience and ability to manage and oversee the management of its securities portfolio. It is further alleged that OmniArch did not properly disclose dividends and distributions of more than $1 million that were paid to a company controlled by Rajeev Singh, an inactive director and the spouse of Arti Modi.
Between 2010 and 2016, OmniArch raised about $127 million from investors to invest on their behalf in residential mortgage backed securities (RMBS) in the United States. A RMBS is an instrument whereby cash flow depends on the cash flows of an underlying pool of mortgages. The portfolio of RMBS was last valued in August 2016 at about $13 million. OmniArch has commenced an action for fraud and breach of contract against its former fund managers.
Pursuant to an earlier order of the ASC dated May 19, 2017, OmniArch was cease traded and none of Jay Modi, Arti Modi or Rajeev Singh are allowed to be officers or directors of a related entity known as LendingArch Financial Inc.
The allegations have not been proven.
An appearance to set a date for a hearing will be held on May 22, 2019 at 3:00 pm in the ASC Hearing Room on the 5th floor, 250 – 5 Street SW, Calgary, Alberta.
A copy of the Notice of Hearing can be found on the ASC website at albertasecurities.com.
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For further information please contact:
ASC Public Inquiries
Toll Free: 1-877-355-4488
inquiries@asc.ca