The Globe and Mail reports in its Thursday, Nov. 10, edition that the Ontario Securities Commission alleges that Cormark Securities facilitated an "illegal and abusive short-selling scheme" where it misrepresented to one client, Canopy Growth, the purpose of a series of transactions to allow another client to net $1.27-million. The Globe's Greg McArthur and David Milstead write that Cormark "vehemently denies the allegations against it" and saying it made full disclosures to Canopy. The OSC's allegations date back to March 17, 2017, which is when a Cormark client, Marc Bistricer, sold short 2.5 million Canopy shares through his investment holding company for about $26.76-million. At that time, Mr. Bistricer did not possess those shares, but he anticipated acquiring them in a series of transactions, executed by Cormark, in the days ahead so that he could settle the trade, the OSC alleges. On March 22, Mr. Bistricer's company bought 2.5 million shares directly from Canopy for $24.25-million in a private placement, the OSC alleges. However, because Mr. Bistricer bought those shares as an accredited investor, there was a hold period on them, which prevented him from using them to settle the trade five days earlier, the OSC alleges. In order to get around that hold period, the OSC alleges, Mr. Bistricer's company entered into a securities lending agreement with a director of Canopy, Murray Goldman, who held his own free-trading Canopy shares. Mr. Bistricer provided his 2.5 million restricted shares to Mr. Goldman's company, the OSC alleges, and in exchange, Mr. Bistricer received 2.5 million unrestricted Canopy shares and used them to settle his trade, the OSC alleges. After paying Mr. Goldman's company a $875,000 securities lending fee and Cormark's fees, which totalled $362,500, Mr. Bistricer's company's profit was $1.27-million, the OSC alleges. The OSC alleges Cormark failed to deal with Canopy "fairly, honestly and in good faith." In a statement to The Globe, Cormark chief operating officer Susan Streeter denies that the company misled Canopy. "Cormark intends to vigorously contest the allegations before the Capital Markets Tribunal." Mr. Bistricer, who is also facing sanction, said in an e-mailed statement: "These allegations are puzzling and appear to be a complete mischaracterization of routine transactions that benefited all parties, including Canopy Growth, index funds and retail investors."