A B.C. man has been ordered to pay $2.6 million by a B.C. Securities Commission panel for duping people into investing in a ski resort that was never built.
The BCSC launched its investigation after CBC News revealed that Ronald Stephen McHaffie, 62, convinced 30 investors to put a total of $642,960 into the proposed Bigfoot Resort, despite having never been registered to sell securities in B.C.
In a statement issued on Friday, the commission said Bigfoot was incorporated in B.C. in 2003 to purportedly develop a recreation and ski area near Jones Lake, B.C. between Hope and Chilliwack, but never filed a prospectus.
"The panel found that, through the sale of shares in Bigfoot, McHaffie committed a fraud.
"In that regard, McHaffie made false statements to entice investors, such as telling them that their investment would be used for expenses related to getting Bigfoot publicly listed, and that construction or completion of the ski resort was imminent."
The panel's findings went on:
"These statements were false, as McHaffie used investor funds to pay for personal expenses, including gas, restaurants, groceries and retail purchases, not for expenditures related to taking Bigfoot public.
"Furthermore, although Bigfoot’s ski resort proposal was rejected by the provincial government in September 2010, McHaffie continued to raise a total of $111,070 from investors after that date.
"The panel found that Bigfoot’s distribution of shares to 27 of the 30 investors for proceeds of $621,960 contravened the prospectus requirements in the Securities Act.
"The panel found that McHaffie also contravened the Act because, as a director of Bigfoot, he authorized, permitted and acquiesced in the company’s contravention."
Living in a trailer park
Last year, CBC News tracked down McHaffie and found him in a run-down trailer park in Princeton, three hours northeast of Vancouver, where he claimed he was recovering from an illness.
At the time, McHaffie told CBC News he raised as much as $2 million from investors, But despite the numerous scenic photos, maps, graphs and reports supplied on the project's website, the money contributed by investors apparently vanished.
According to the website, the resort would offer "unparalleled" alpine skiing, mountain biking, snowmobiling, trail riding, fishing, camping, boating, canoeing, rock climbing, a golf course, conference facilities and a spa.