An elderly couple are in the process of losing their Calgary home after agreeing to take out a series of loans at a high interest rate — a scheme police allege was against the law.
Calgary police are looking for a 38-year-old man in connection with the alleged loan and mortgage swindle.
In 2006, the couple, who are on a fixed income, received a series of unsolicited phone calls from a man offering a loan that would give them some financial flexibility.
They agreed to take out a loan using their southeast home as collateral, police said on Monday.
In June 2007, the couple went to a lawyer's office and signed documents they thought were for a reverse mortgage. In reality, police say, they signed over their home to the 38-year-old man police are searching for — who has started foreclosure on the house.
"Contracts, they can be confusing," said Const. Karen Moffatt. "The wad of paper that you get from the bank is lengthy enough, so they were confused by it. They were told one thing and signed a contract for something else."
Investigators believe the couple was urged several times between 2006 and 2009 to borrow more money.
Section 161 of Alberta's Fair Trading Act
The charge of unfair practices alleges someone "did unlawfully commit an unfair trade practice by the supplier taking advantage of the victim as a result of the consumer's inability to understand the character, nature, language or effect of the consumer transaction or any matter related to the transaction."
They ended up getting a loan of $84,000 — at an interest rate of more than 65 per cent — and owe the suspect close to $150,000, said police.
Richard William Hoffman, 38, has been charged with unfair practices under Alberta's Fair Trading Act, as well as with criminal interest rate under the Criminal Code.
Under the Criminal Code, it's illegal to charge more than 60 per cent interest per year.
Investigators have spoken to Hoffman by phone, but have not been able to locate him. They released a photo of the suspect on Monday, in hopes the public can help track him down.
The couple are still living in their home but are fighting the foreclosure through civil litigation, added Moffatt.