At first, Devin Hutchinson couldn’t quite make sense of the email from PricewaterhouseCoopers, sent on behalf of the Supreme Court of British Columbia demanding his general contracting business pay back over $15 million in loans and interest owed to a company he’s never dealt with.
“I thought it was some kind of a scam,” he said.
Turns out, Hutchinson was partially right. Only the scam part happened months ago, when Greg Martel, the Victoria mortgage broker and alleged Ponzi-schemer, appeared to have used the name of Hutchinson Contracting on documents, purportedly to give an air of legitimacy to the fake investments into non-existent real estate projects he was peddling.
Hutchinson has never done business with Martel or his company and said he certainly has never received any loans.
“It’s been a shock … But we have absolutely nothing to hide,” said Hutchinson, who co-owns the company with his dad.
“We’re staying positive and we will do anything and show anything [to help the investigation.] I just hope that they’re able to figure this all out.”
Martel and his company, Shop Your Own Mortgage (SYOM), owe close to a quarter billion dollars in missing investor funds. Martel himself is missing too, out of the country at an unknown location, not co-operating with court orders to produce financial documents and a sworn list of assets.
PwC, the court-appointed receiver, has been tasked with trying to untangle the web of Martel’s U.S. and Canadian investments and business interests to recover assets so hundreds of creditors can recoup some of what they’ve lost.
Devin Hutchinson, left, and Scott Hutchinson, co-owners of Victoria’s Hutchinson Contracting, where shocked to receive a demand for loan repayment of $15 million. (submitted by Hutchinson Contracting)
Martel and SYOM were in the business of providing private bridge loans to real estate developers needing short term financing, attracting investor cash by promising annualized rates of return that often exceeded 100 per cent.
Hutchinson said according to PwC, Hutchinson Contracting was listed as receiving three such loans from Martel for three made-up projects.
“Apparently there were investments made for us to complete two custom homes for $5 million each and another one for something else,” he said.
CBC reached out to Martel’s lawyer Ritchie Clark, who had no comment.
In an email to CBC last month, Martel denied he was running a Ponzi scheme. (A Ponzi scheme is a form of financial fraud where investors are lured into a non-existent enterprise that pays out early investors with the funds put in by investors who join later.)
According to clients, Greg Martel, sole director of My Mortgage Auction Corp., went online on a number of occasions to try to calm investors who were owed money. (VIMEO)
Martel started SYOM in about 2016. Earlier this year, investors started complaining about longer and longer delays in getting their investments paid out. Martel was quick to make assurances that everybody would get paid, attributing the problems to overwhelmed company systems from too many new people wanting in on the action.
Soon after, the payouts stopped altogether and over a dozen investors brought civil suits against Martel.
Martel and SYOM were put into receivership in early May at the request of an investor who is owed $17.6 million.
PwC reported the SYOM company bank account had $58 million dollars flow in and out in the last six months, but by the time the account was seized, there was less than $300 remaining.
Investigators also said they had only been able to locate superficial documentation about the SYOM bridge loans, and nothing that identified who the loans were made to.
A clearer picture of Martel’s actions — and whether there is reason for investors to feel optimistic — is expected to emerge Friday morning when the case returns to B.C. Supreme Court in Vancouver.
TORONTO – Canada’s main stock index was up more than 100 points in late-morning trading, helped by strength in base metal and utility stocks, while U.S. stock markets were mixed.
The S&P/TSX composite index was up 103.40 points at 24,542.48.
In New York, the Dow Jones industrial average was up 192.31 points at 42,932.73. The S&P 500 index was up 7.14 points at 5,822.40, while the Nasdaq composite was down 9.03 points at 18,306.56.
The Canadian dollar traded for 72.61 cents US compared with 72.44 cents US on Tuesday.
The November crude oil contract was down 71 cents at US$69.87 per barrel and the November natural gas contract was down eight cents at US$2.42 per mmBTU.
The December gold contract was up US$7.20 at US$2,686.10 an ounce and the December copper contract was up a penny at US$4.35 a pound.
This report by The Canadian Press was first published Oct. 16, 2024.
TORONTO – Canada’s main stock index was up more than 200 points in late-morning trading, while U.S. stock markets were also headed higher.
The S&P/TSX composite index was up 205.86 points at 24,508.12.
In New York, the Dow Jones industrial average was up 336.62 points at 42,790.74. The S&P 500 index was up 34.19 points at 5,814.24, while the Nasdaq composite was up 60.27 points at 18.342.32.
The Canadian dollar traded for 72.61 cents US compared with 72.71 cents US on Thursday.
The November crude oil contract was down 15 cents at US$75.70 per barrel and the November natural gas contract was down two cents at US$2.65 per mmBTU.
The December gold contract was down US$29.60 at US$2,668.90 an ounce and the December copper contract was up four cents at US$4.47 a pound.
This report by The Canadian Press was first published Oct. 11, 2024.
TORONTO – Canada’s main stock index was little changed in late-morning trading as the financial sector fell, but energy and base metal stocks moved higher.
The S&P/TSX composite index was up 0.05 of a point at 24,224.95.
In New York, the Dow Jones industrial average was down 94.31 points at 42,417.69. The S&P 500 index was down 10.91 points at 5,781.13, while the Nasdaq composite was down 29.59 points at 18,262.03.
The Canadian dollar traded for 72.71 cents US compared with 73.05 cents US on Wednesday.
The November crude oil contract was up US$1.69 at US$74.93 per barrel and the November natural gas contract was up a penny at US$2.67 per mmBTU.
The December gold contract was up US$14.70 at US$2,640.70 an ounce and the December copper contract was up two cents at US$4.42 a pound.
This report by The Canadian Press was first published Oct. 10, 2024.
