The Respondents sent their time-sensitive Settlement proposal to Staff on November 7, 2013. Finally after 7 weeks of waiting the Respondents were very eager to receive the reply from the Litigator at the BCSC. As the attachment was opened, eagerness turned to frustration as Staff indicated they did not even take the Settlement Agreement to the Executive Director for approval (or even a review/negotiation). The reason the offer was time sensitive is the builder and lender were anxious to move the project forward in a timely fashion. There was NO reason ever given why Staff took this amount of time to reply.
Instead Staff indicated the only way they would take a Settlement Offer to the Executive Director is IF pleaded guilty to their long list of allegations and agreed to pay $5.8 million dollars in fines and disgorgement. The BCSC website indicates all Settlements must be paid in full at the time the Settlement Agreement is agreed to – this was impossible for the Respondents, let alone the FACT that many of the allegations in the Notice of Hearing were NOT accurate.
ON WHAT PLANET DOES A PERSON HAVE TO PLEAD GUILTY TO ALL ALLEGATIONS OUTLINED IN A NOTICE OF HEARING AND THEN PAY A “RANSOM” OF NEARLY $6 MILLION DOLLARS JUST TO GET THEIR SETTLEMENT OFFER NEGOTIATED? THIS IS BORDERLINE EXTORTION!
The parties could have avoided a long, lengthy, expensive hearing IF Staff Litigators and the Executive Director would have even looked at the proposal and actually thought about the investors. In hindsight, it appears that the BCSC did not have the investors best interest at stake as their website promotes – nor was it a fair system for all parties. Please read for yourself, the reply from Staff and ask “WHY DID THE BCSC NOT TAKE THE TIME TO EVEN REVIEW THE SETTLEMENT AGREEMENT WHEN SO MUCH WAS AT STAKE FOR THE INVESTORS?”
We encourage anyone affected by the Settlement Offer not even being put onto the Executive Directors desk for a review to contact the BCSC at 1-604-899-5600 during regular business hours. Maybe you can get an answer – the Respondents have certainly not been able to do so.
What a last couple of weeks it has been for Walton International – the Alberta Securities Commission suspended Walton’s registration which prohibits them from selling any more of their investments. And then they hired Ernst & Young to take them through the CCAA process in an attempt to re-organize their debt. This sounds almost identical as the League Assets story we discussed last summer in this blog post. One can conclude the Walton matter will have the same ending! How can a company make hundreds of millions of dollars selling land be broke after 25+ years of being in business? Rumor on the street is the company is being gutted and those (at the top) have already cashed out their millions…
WAS THIS ALL PREDICTABLE?
Back a few years ago I came across a Sales Representative that worked at Walton International at a Calgary Flames hockey game. After chatting for a few minutes he suggested I look at his investment opportunity – it was a parcel of land down by Spruce Meadows (in the southern tip of Calgary). Although I was not interested in the investment, I agreed to meet with him at his office a short while later.
I remember their office being really nice and it seemed like they had a ton of staff. After receiving a brief sales pitch I was sent on my way with an envelope full of paperwork. Some time later, I opened the envelope and (as part of the package) discovered a letter from a lawyer named Donald Boykiw from the fancy Bennett Jones LLP law firm.
The letter is short and cuts to the point – it indicates that Boykiw is writing to inform Walton that the Alberta Securities Commission had reviewed Walton’s business practice of selling undivided interest in land to purchasers and that this review had been done as a result of sanctions against Walton’s prime competition in Alberta land banking. Boykiw goes on to state, “I would also advise that the Commission staff member who was involved in this matter has further advised that the ASC’s enforcement counsel would not be recommending any changes to the current forms of referral arrangements for both the mortgage referrals from Westmount Mortgage Corporation and the land referrals from Cordex Realty. We have also received a follow-up call from the registration counsel at the Alberta Securities Commission indicating that they ave also completed their review of such referral agreements and were not proposing any changes.” A copy of the letter:
The significance of this letter is simple – Walton International’s business model sees them allegedly buying farm land for as little as $400 per acre and turn around only days later and sell it for up to 7000% increases to investors from all over the World – and the gang down at the ASC gave them a clean bill of health while sanctioning others in the same line of work. And don’t forget – this happened during Ralph Klein’s duration as Premier of Alberta who’s daughter physically worked at Walton’s head office.
For those people that do not know who Walton International are (or were) – they purported to be the largest land banker (and then later land developer) in the nation. They had many projects throughout Canada and the United States. They had come under fire in some circles for paying huge upfront commission to their sales people and for having lavish spending sprees on chartered boats and trips for Staff. In one instance, it was reported they had chartered a large ship and had the expensive Self-Help Guru Anthony Robbinsas a guest to get their staff motivated to sell their product.
Facts are – may people have been reporting on Walton’s demise for years. A simple google search has found us endless reports from press from all over the World suggesting Walton’s business plan had some distinct cracks and was leaking severally. An article in the Ottawa Citizen from March 2013 suggests the land banking project in Ottawa was in trouble.
What happened in Singapore when they had several complaints about many Land Banking firms – even Walton International? Out comes the huge Public Relations wheel and they brought an entire news crew to see their operations in Canada….
This video is so biased towards Walton but comes across as some bi-partial news telecast – We wonder how much more they raised after this video made the rounds…
Would this all have been avoided IF the ASC had not given them that clean bill of health back in 2002 – that they used as a sales aid for their sales people??? Shame on the ASC! This story is going to be huge when the cards ALL come falling down – and this letter is going to be used in any case against the ASC! How are they going to be able to protect the Walton Investors when they are complicit in allowing Walton to exist – even going as far as giving legal advice that their sales people used to close the unexpected investors?
It looks like the definition of a CHICKEN SHIT COWARD continues to be the BCSC’s junior litigator Olubode Fagbamiye! In repeated request for Fagbamiye to answer our questions, he continues to cower and hide from answering any of them (or even denying our allegations). As you are aware, we sent him a formal letter on December 7, 2016 after our phone call to his office. During the phone call on December 5, 2016 he specifically says to write the questions down and communicate via written correspondence. Was he just saying that to get off the phone? It now appears so!
According to our friends at http://bcsccriminalcharges.blogspot.ca , this would put Fagbamiye in breach of a “Statutory Requirement for a government department to reply to all written correspondence within 14 days…”. If true, how does this continue to happen at the British Columbia Securities Commission? How are they above the law?
Mr. Fagbamiye – how does it feel to look in the mirror and know that you are part of the issues that continue to haunt the BCSC? How does it feel to be such a coward and fail miserably at your job?
Can someone working at the BCSC go down the hall way and make sure he is awake? Perhaps he naps throughout his days and has issues with getting his job done? Who knows?
The following is an exert from the blog Unpublished Ottawa on Regulatory Fraud:
From the Desk of Larry Elford, originally Posted on January 29, 2018
Author’s Note: My circle of malpractice and misconduct investigators can find no possible public interest benefit, and considerable public interest harm, in learning that Securities Commissions are ‘aiding the industry’ in deceiving, and hiding essential information from the public.
The video below shows (at the one minute mark) how the commissions in Canada informed the public about the difference between an investment salesperson and a registered investment adviser. (a fiduciary professional with a duty to “do no harm” to investors) This ‘clarity’ was in place from September 2009 until January 2018, when for some reason, the commissions decided to eliminate some of the clarity for investors. They further removed (twice now) information which cautioned and informed investors. Why?
Author’s Video Note
This is how a “confidence man” works:
Prior to September of 2009, the license and registration category of your investment “advice giver” was (in 99% of cases) one of the following two choices:
a) a registered investment adviser (the “Do no harm” fiduciary professional) or b) a registered “salesperson” (the one where they could act against the investor interests)
Investors were not well informed, back then, as most, if not all persons who were registered in the “salesperson” category preferred to call themselves by a non registered and non-regulated title, spelled “advisor”.
By clever use of a single “Vowel Movement”, millions of investors are deceived, and led to believe they have a “do no harm” fiduciary-duty professional, while the salesperson and the dealer have accomplished a clever bait and switch. They will have convinced trusting clients that they are dealing with someone to be trusted, while actually hiding the saleperson’s lesser duty of care.
“ the confidence man is someone who preys upon peoples confidence in them”
Fast forward to September of 2009, when the CSA (umbrella organization of all 13 Canadian Provincial Securities Regulators), decide to change the rules/laws in Canada, REMOVING every mention of the word SALESPERSON in the Securities Act, rules. They replace that rather clear term, with the term “DEALING REPRESENTATIVE”. To be fair, they did, in some documents place the word (Salesperson) in brackets, immediately behind the word “Dealing Representative”. That helped maintain some of the original info and intent of the disclosure.
Still, one a small step was taken in the direction of “editing out” the term “Salesperson” from the Securities Rules and laws in Canada. The important thing to keep in mind, is that Securities Commissions did NOT move to eliminate the commission sales role from “advice givers”, but rather they simply allowed commission-sales “advice givers” to obfuscate their ‘label’, to in effect be less clear and open to their investor clients. Allowing them to hide their registration and job role from investors.
They continued (as they do to this day) to refer to themselves as “Advisors” in most cases, despite Securities Act rules and laws against “misrepresentation of ones registration category”. It simply serves investment salespeople better if they do not tell their customers that they are “salespersons”. Trust (and the customer’s money) is easier to gain if they conceal the true “salepserson” registration behind a not-true advisor title…(gaining trust by concealment?<
Fast forward to January 2018 and the new changes quietly put into place have now deleted the (salesperson) clarification from the “Understanding Registration” page of the CSA web site. It appears that the provincial governement regulators truly do not want the public to “Understand Registration”, when it comes to investment salespersons…
This again brings to mind the regulatory double mandate, double-bind,..of having to do what they industry pays them to do….or else.
Ten million Canadians who rely upon their investments to support themselves financially in retirement should not be treated to intentional obfuscation and apparent deception, by the investment industry, and most certainly not by government empowered (but industry paid/selected) securities regulators. This smacks of foxes guarding the henhouse, and helping their fox friends to pillage the hens, while working for a provincial government which tells the public that they are safely regulated and protected. It smacks of a breach of the public trust…See source for the full article here:<
Mr. Larry Elford is acclaimed as one of Canada’s top qualified experts on the subject of White Collar Crime as it relates to the investment selling industry. He is a retired CFP, (Chartered Financial Planner), a CIM, (Certified Investment Manager) by the Canadian Securities Institute, a FCSI, (Fellow of the Canadian Securities Institute), the highest designation awarded by the Canadian Securities Institute to those for top achievements in educational and industry accomplishments. He is also an Associate Portfolio Manager and Director of the Canadian Justice Review Board of Canada. Larry is often called upon as an expert with national broadcasters like CTV, Global and CBC.
Mr. Elford worked inside the largest financial institutions in Canada for twenty years until his retirement in 2004. He works today writing, speaking and coaching Canadians on how to create safe and honest treatment for investors.
Mr. Elford is also an author and film producer. He was included in John Lawrence Reynolds’ second edition bestselling book, The Naked Investor, Why Almost Everybody But You Gets Rich On Your RRSP and Bruce Livesey’s 2012 book, Thieves of Bay Street, How Banks, Brokerages and the Wealthy Steal Billions from Canadians. He produced a compelling documentary film, Breach of Trust, The Unique Violence of White Collar Crime, to benefit investors, legislators and those who investigate financial crime.