After a series of successes over the following years, including a lucrative investment in a TSX-listed coal company recommended by Peters, the husband asked if he could recommend any coal companies listed on the TSX Venture Exchange. Peters recommended Colonial Coal, a junior exploration company that was classed as a high-risk investment.
By January 31, 2011, around 448,900 shares of Colonial Coal had been bought and held in the wife’s accounts, representing roughly 47% of all the holdings in those accounts. In February, Peters updated the wife’s investment objectives to 100% speculative (high risk), stating in the account update form that she had “capacity for increased risk.”
Shortly thereafter in April, the husband emailed Peters to say that his wife was being let go from her job as a pharmacist, and that her employer would continue to pay her for 18 months unless she found another position, and then she would be paid half of what she would have received. During that time, the couple were in the course of borrowing money from a bank so they could buy more shares of Colonial Coal.
Peters continued to recommend and purchase Colonial Coal shares in the wife’s accounts; by June 30, 2012, the wife’s accounts held 580,950 shares of the company, which had declined in value by roughly 54%. The following month, the wife opened a locked-in RRSP account at Peters’ firm and transferred in the entirety of her pension from her employer, which was just over $260,000. The full amount was used to purchase Colonial Coal shares.
The husband told Peters that his wife wanted to keep purchasing shares of the company, and Peters kept recommending them. By November 2012, the wife’s accounts had purchased some 974,300 shares for around $1,098,598, with almost the full market value of her accounts placed in Colonial Coal.
