However, a lawyer for Pushka and Crown Hill said they plan to appeal both the penalty and an earlier finding that forms the basis of the OSC panel's decision, dated Aug. 8.
In a 52-page penalty decision ruling released on Monday, an OSC panel ordered the respondents to pay $300,000 towards the OSC's costs, pay a $1.875-million administrative penalty, and to give up $18.2 million obtained as a result of the deal.
Pushka, who was considered Crown Hill's guiding mind as an executive and sole shareholder of the company, was also banned from several investment and professional activities for at least 10 years or until the money is paid to the provincial commission.
"Today's decision demonstrates the OSC's commitment to ensuring fund managers, entrusted with investor's money, are abiding by their fiduciary duty," said Tom Atkinson, director of enforcement at the OSC.
"It also sends a clear message to the marketplace that if you break the rules, you're going to pay — the Commission doesn't shy away from ordering large monetary penalties when the amounts obtained are a result of non-compliance with Ontario securities law and abusing the trust of investors."
The largest of the financial penalties, disgorgement of about $18.2 million, was based on termination fees paid in 2012 or 2013 to Crown Hill or its affiliate Triple Two for resigning as manager of certain funds. The ruling says the disgorgement order excludes a further $17.4 million in break fees and termination fees paid by Citadel funds or any management fees.
Alistair Crawley, one of the lawyers who acted for Pushka, said in an emailed statement that the OSC sanction decision is unprecedented and "amounts to a confiscation of monies received over a four-year period after the transactions at issue."
"Considering also that there were no investor losses, the sanction decision is outlandish. Crown Hill and Mr. Pushka intend to appeal both the decision on the merits and the sanction decision," Crawley wrote.
He added that Pushka remains chief executive of Crown Hill but that the company is no longer in the investment fund business, having sold its assets in January 2013.
In addition to the financial penalties, the OSC says Pushka and Crown Hill aren't allowed to trade or acquire in any securities or derivatives until all the money is paid. Pushka is also to resign as an officer or director of any public company, registered dealer or investment fund manager, and be prevented from having those roles for at least 10 years or until the money is paid.