BCSC secures order for sale of property owned by fraudster

The British Columbia Securities Commission (BCSC) has obtained a court order for the sale of property in Hawaii, the proceeds of which will be returned to the fraud victims of a former mutual fund representative.

Read: Regulator alleges B.C. man committed fraud

The court order from the Third Circuit Court of the State of Hawaii is for the sale of property belonging to David Michael Michaels. In 2014, a BCSC panel found that Michaels committed fraud against 484 investors, many of them seniors, and imposed $23.3 million in sanctions against him.

The regulator launched lawsuits in relation to property in Hawaii and Mill Bay, B.C. in an effort to collect, a BCSC release said. Michaels is a co-owner of the Hawaii property but doesn’t own the Mill Bay property.

Last month, the commission entered into an agreement with Michaels to sell the Hawaii property with the proceeds going to the BCSC, the release said. The BCSC will also receive a cash payment of $50,000 from Michaels.

The commission will then distribute both amounts to investors, it said. The agreement doesn’t affect the BCSC’s ability to continue to collect against Michaels’ outstanding sanctions.

Doug Muir, the BCSC’s director of enforcement, called it “a great outcome” for Michaels’ victims.

“It avoids the further delay and uncertainty of lawsuits, which means we will have money to return to victims sooner,” he said in a release. “The BCSC will continue our efforts to collect our sanctions against Mr. Michaels, and this agreement is a good step as part of that process.”

When the commission has received the money, it will place a notice on its website with instructions on how investors can make claims.

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Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.