Many of the alleged victims of two Calgary men accused of orchestrating a $27-million fraud were retirees who lost their life savings, claims one former investor.
Jon Edmunds is among 84 investors involved in a lawsuit against Ken Fowler.
- 2 Calgary men wanted for securities fraud
- Listen to the interview with Edmunds on the Calgary Eyeopener below:
An arrest warrant was issued for Fowler on Monday, along with his alleged accomplice Douglas Schneider.
They are accused of selling fraudulent securities through their company — Investment Exchange Mortgage Corporation, or TIE Mortgage — and making misleading statements to investors.
The Alberta Securities Commission (ASC) says the whereabouts of Fowler and Schneider are not known.
Edmunds, who was promised an 18 per cent return on his $100,000 investment, said many of the alleged victims were left with nothing.
“I’m an accountant. I should have known better. I feel very bad about the decision I made, but the reason I’m continuing on this is seeing these retirees being taken advantage of,” he said.
“One woman in particular, she’s 80-years-old [and her] husband died about three or four years ago — she’s left with nothing. She had invested apparently $400,000. She’s now living on CPP and Old Age.”
The money Fowler raised through TIE Mortgage was supposed to be invested in short-term loans, according to a financial inspector appointed by a Court of Queen’s Bench judge last year.
Alleged victim wants justice
Jon Moroz, a lawyer representing many of those suing Fowler for fraud, said they learned through the inspector that the underlying business didn't exist.
"As is set out in the fraudulent financial documents, the funds were stated to be used to place mortgages against properties and that was the stated purpose; however, that simply didn't exist," he said.
ASC had issued a cease-trading order for the company in November 2012.
But court documents claim Fowler was using some of the money to finance his own lavish lifestyle. The claims have not yet been proven in court.
“He bought his wife a diamond ring for $125,000, bought himself a Porsche — not sure what he paid for it — bought a house down in Palm Springs, that type of thing — trips to Switzerland,” Edmunds said.
While he has given up hope of recouping his investment, Edmunds said he wants justice.
“This is the shame that I can see, he took this money from people who couldn’t afford to lose it,” he said.