March is Fraud prevention month
Why do people keep investing, it's obvious about all these scammers. There is no greedy investors out there? We should our money the banK.
The exempt market was not intended for those types of huge real estate deals and for awhile there was some confusion as to who had authority; the Real Estate Council of Alberta or the ASC. Eventually those two groups sorted it out and the ASC took over authority in this area, well after the damage already had been done but was not yet overtly apparent.
Yes, losses could have been avoided or at least mitigated had RECA taken control. And had the market and abusers been reeled in sooner.
You make some valid points that do deserve acknowledgement. But the litigation process that investors are subject to is grossly over-priced, too long in process and flawed in results. Investors are trully at the mercy of an overcrowded court system, lawyer's competency, and time.
Actually all securities regulators across Canada, and also in the United States, have an exempt market. It is not new, it has been in existence for decades. In 2009 the ASC did lead the charge to regulatory and registration reform in the exempt market. It was British Columbia that did not go all the way and allowed guys like Mr. Jones to continue to operate under the Northwest Exemption which the ASC opposed but acquiesed to eventually in order to have registration reform pass. BC wants to eliminate the North West Exemption, realising now what they were warned about when they insisted in be included in registration reform. What many are ignorant of is the exempt market is not a creation of Alberta or the ASC but it has been sold like that in various articles. If you want to criticise make sure you have your facts correct, otherwise it is just an opinion. Regardless of whether you have an exempt market or not you always will find those who wish to take advantage of others - boiler room scams, penny stocks, and those who willingly swallow the bait with visions of wealth coming their way. The exempt market was not intended for those types of huge real estate deals and for awhile there was some confusion as to who had authority; the Real Estate Council of Alberta or the ASC. Eventually those two groups sorted it out and the ASC took over authority in this area, well after the damage already had been done but was not yet overtly apparent. No system is perfect and anyone pitching that idea to you is no different than the person who sold many of these investments before having to be registered - they are selling poppycock. This is not about the PC buddies at all. This is about securities regulation and this reform begun back in 2009 is still ongoing and will continue to be.
The ASC took Brost/Sorenson to hearings on numerous occassions and found them in violation but they moved off shore, beyond the reach of the ASC and law enforcement. From the time the ASC last took these guys to a hearing it took another six years for the RCMP to finally nail them in court, and thirteen years after the ASC first took action against them. It is not about the RCMP and the ASC not talking or an unwillingness to talk but about the inability of law enforcement to have staff on hand who understand securities law and can prosecute it. The RCMP after the ASC has found someone guilty like Cleone Couch, have refused to file charges against her. Sadly the ASC cannot take these crooks to a criminal hearing but law enforcement is in the dark when attempting to prosecute. That is the issue. Remember IMET failed after thirteen years and a few hundred million dollars and nothing came of it. Quebec found a guy guilty of securities fraud and the RCMP then charged them with fraud in criminal court and lost the case. That is the issue.
And the fraud artists continue to go on with their lives, while ours is in ruin.
The ASC created and supported the Exempt Market and then did next to nothing to reign in the fraud artists that profited from the absense of controls and consequences.
Contact your (probably new) MLA and let them know how the ASC and their PC buddies let you down. let them know how your life has been affected and how the ASC scorned you the investor, while their mandate is to protect you.
I agree with such a small budget there is no way to investigate these. The ASC should be doing more Proactive work then reactive work after the fox is in the hen house.
Good luck!
Unless the courts and the regualtors and the police start to work together, the abuse will continue to mount, because their is little downside to fraud.
The courts are negligent in thier undesrstanding of the situtation and to their willingness to invoke meaningful penalties to curb the extent, the past, and the continuation of fraud.