OCM Auto Financing Placed in Receivership After Refinancing Collapse
OCM Auto Financing Group Ltd. and OCM Auto Financing Fund Ltd. were placed into receivership on September 21, 2026, following a failed refinancing effort and a dispute over collections from their auto loan portfolio. The Ottawa-based companies, which specialize in sub-prime and secondary auto lending, initially relied on private-investor debentures before securing a financing arrangement with CWB Maximum Financial Inc. in 2023. This facility grew to $60 million and later transformed into a master purchase and servicing agreement under which CWB funded auto loans and purchased receivables. National Bank of Canada eventually succeeded to CWB’s rights.
By late 2025, National Bank sought to exit the relationship. A December 31, 2025 amending agreement gave OCM until May 29, 2026, to refinance, with a binding third-party capital commitment required by April 17. National Bank extended this deadline twice, first to May 29 and then to June 30. OCM pursued refinancing with Encina Lender Finance but acknowledged in late June that the transaction would not close. The company then retained Sinclair Range Inc. as chief restructuring officer to explore alternatives. On June 30, OCM informed National Bank that it could not repay the indebtedness, triggering a liquidity crunch that impacted OCM’s servicing obligations.
National Bank issued a collections invoice of approximately $906,557 on July 1 and terminated the servicing arrangement on July 3. By July 6, the blocked account used for collections had a negative balance of approximately $11,217, down from deposits of approximately $809,698 in May and $769,035 in June. National Bank demanded payment and issued a section 244 notice on July 8, designating Go To Loans Inc. as the replacement servicer. OCM admitted transferring $63,000 from the blocked account and using collections to fund ordinary operating expenses before remitting amounts due to the bank at month-end. There were also approximately $420,000 of transactions between June 22 and July 6, including professional fees and payments to shareholders, an investor, and a non-arm’s length party. OCM acknowledged that some shareholder payments were inappropriate and stated they had been reimbursed.
KPMG was appointed interim receiver on July 23. Its review identified approximately 3,158 loans with a net present value of $47.2 million, including 1,526 loans worth $19.9 million in National Bank’s portfolio and 1,622 loans worth $27.3 million in OCM’s portfolio. The reserve account held approximately $4.8 million as of July 31. KPMG also reported that OCM appeared to have understated the number of defaulted contracts under the servicing agreement. On September 21, KPMG was appointed as full receiver and manager over all of the companies’ assets. The receivership order authorizes KPMG to operate or wind down the business, collect receivables, market and sell assets, and transition servicing to the replacement servicer.
As of the receivership, National Bank was owed approximately $14.9 million. Computershare Trust Company of Canada, as trustee for debenture holders, represented approximately $49.9 million of additional debt. There is also nearly $1 million in unsecured claims. KPMG is the receiver, with counsel including Gowling WLG for National Bank, Fasken for the receiver, and Conway Baxter Wilson for OCM.