OSC Hearing Sheds Light on Rising Trend of Misleading Crypto Asset Claims

By Sharon Henderson

Toronto – The Ontario Securities Commission (OSC) is set to hold a case management hearing on November 14th concerning Benjamin Ward, a case that underscores a rapidly escalating regulatory scrutiny of the booming, yet often opaque, crypto asset market. While details remain sparse, documents filed with the Capital Markets Tribunal reveal allegations centre around misleading representations made to investors regarding a now-defunct crypto investment fund. This case, according to sources within the OSC, signals a broader crackdown on unsubstantiated claims and inadequate risk disclosures within the crypto space.

The Allegations: A Pattern of Misleading Claims

The OSC’s investigation, initiated in early 2025, focuses on Ward’s role as a key promoter of “Nova Crypto Fund,” a venture that promised outsized returns through investments in a diverse portfolio of altcoins and DeFi projects. Documents suggest that promotional materials for Nova Crypto Fund significantly overstated potential profits, downplayed inherent risks, and lacked transparent disclosure of associated fees. The OSC alleges that Ward knowingly participated in distributing these misleading representations, attracting a substantial number of retail investors, many of whom are now facing significant losses following the fund’s collapse in Q3 2025.

“The problem isn't crypto itself,” explains a source familiar with the OSC investigation, speaking on condition of anonymity. “It's the rampant hype and unsubstantiated claims being made by some promoters who are prioritizing profits over investor protection. We’ve seen a surge in complaints related to crypto investments, and this case is one of the first to reach a formal hearing stage.”

A Rising Tide of Enforcement
The case against Ward arrives amidst a global increase in regulatory attention on the crypto industry. The SEC in the US has been aggressively pursuing enforcement actions against crypto firms, and European regulators are finalizing comprehensive rules for digital assets. The OSC appears to be aligning with this global trend, signaling a commitment to safeguarding Ontario investors from the risks associated with this volatile market.

OSC annual reports reveal a 35% increase in crypto-related complaints in the past year, ranging from outright fraud to inadequate risk disclosures and unregistered platforms. “We’ve been warning investors about the risks of crypto for some time,” says another source within the OSC. “But the volume of complaints has forced us to take a more proactive approach.”

The OSC’s increased scrutiny is not limited to enforcement actions. The regulator has also been actively issuing investor alerts, publishing educational materials, and collaborating with other regulatory bodies to share information and best practices.

Ward’s Background and Career Trajectory

Benjamin Ward, formerly a respected financial advisor with a major Canadian bank, transitioned to the crypto space in 2023, establishing himself as a vocal advocate for digital assets. He quickly gained prominence within the crypto community, leveraging social media and industry events to promote Nova Crypto Fund.

“He presented himself as a knowledgeable and trustworthy expert,” recounts a former investor in the fund, speaking anonymously. “He spoke convincingly about the potential of crypto, and I believed him. It’s devastating to learn that those claims were likely false.”

Prior to his foray into crypto, Ward's record at the bank was largely unblemished. However, regulators are now examining whether his transition to the unregulated crypto space – and the subsequent lack of oversight – contributed to the alleged misconduct.

Investor Impact and Potential Recourse
The collapse of Nova Crypto Fund has left numerous investors facing substantial losses. While the exact amount remains unclear, estimates suggest that the fund managed over $20 million in assets at its peak.

The OSC is currently working to determine the extent of the investor losses and explore potential avenues for recourse. However, recovering funds from a collapsed crypto fund is notoriously difficult, given the decentralized nature of the technology and the lack of traditional safeguards.

“Investors need to understand that there are inherent risks involved in crypto,” warns a financial lawyer specializing in digital asset litigation. “Due diligence is crucial. Don’t invest in anything you don’t fully understand, and be wary of promises of unrealistic returns.”

The Broader Implications

The OSC’s case against Benjamin Ward is more than just a single enforcement action. It signals a broader shift in regulatory approach towards the crypto industry, prioritizing investor protection and market integrity. The hearing is expected to set a precedent for future enforcement actions and provide clarity on the regulatory expectations for crypto firms operating in Ontario.

“We want to create a level playing field and ensure that investors are treated fairly,” explains a senior OSC official. “The crypto industry has the potential to be innovative and transformative, but it needs to be regulated responsibly.”

The outcome of the hearing is likely to have ripple effects throughout the Canadian crypto ecosystem, encouraging greater transparency, accountability, and investor education. Investors, meanwhile, are urged to exercise caution, conduct thorough research, and understand the risks before investing in this volatile and rapidly evolving market. The case serves as a stark reminder that the promise of quick riches in the crypto world often comes with a significant degree of risk – and that regulators are increasingly focused on protecting investors from those who exploit that vulnerability.