Victoria mortgage broker Gregory Martel, who is facing several civil lawsuits that claim he and his company owe more than $27.5 million to clients who invested with him, no longer has control of his company after the B.C. Supreme Court appointed a receiver to oversee operations.
This week, the court appointed PricewaterhouseCoopers to take control and oversee the operations of My Mortgage Auction Corp., which does business as Shop Your Own Mortgage, a company founded by Martel in 2016.
The court acted at the behest of one of Martel’s investors, a numbered Alberta company based in the hamlet of Ardrossan.
The company, 1548199 Alberta Ltd., is one of several investors who have filed suit against Martel claiming he owes them money.
In its statement of claim, the Alberta firm claims to have advanced more than 80 parcels of money ranging from as little as $43,500 to $3.51 million to be used by Martel and his firm to provide short-term bridging loans for real estate deals.
In exchange, the numbered company was due to be paid back its principal plus interest that ranged between seven per cent and 25 per cent.
The Alberta firm claims it is owed more than $17.59 million.
In its application for a receiver to be appointed, the Alberta company noted neither Martel nor his company has made payment for the outstanding amounts due under the investment agreements
The Alberta firm urged the court to appoint a receiver so Martel’s business assets can be protected, reviewed and assessed for the benefit of all stakeholders.
The firm also pointed out it wasn’t alone and that a slew of other lawsuits have been filed against Martel and his company since April with very similar stories about providing investment for short-term loans.
In each of the suits filed, individuals and companies claim they invested money with Martel on the understanding the money would be used to provide short-term bridge loans for commercial and residential real estate deals.
The total value of those investments is claimed to be in excess of $25.7 million.
“Despite repeated attempts by lenders to reach MMAC and Martel for further information, there has been no communication from MMAC or Martel,” the Alberta firm noted in its court filing. “It is clear that MMAC and Martel have not been able to meet their obligations.”
The application also pointed out there are other creditors whose loans have not been repaid and have yet to commence legal action.
Also filing suit against Martel is Victoria engineer Andrew Townend and his company Avica Consulting, which together made seven loans to Martel and My Mortgage. Townend claims he is owed $140,933.13 and Avica is owed $431,006.79.
Court records show Martel filed a response to Townend’s lawsuit and denied any wrongdoing and said Townend had not incurred any loss, damage or expense as a result of his default.
“The defendant has not wrongfully handled, misappropriated, embezzled, disposed of, or destroyed the plaintiffs’ monies. Instead, due to internal delays resulting from high client volume and staff shortages, the defendant has not been able to pay the plaintiffs the claimed amount,” the response said. “The defendant intends to return the plaintiffs’ monies and does not dispute the amounts claimed.”
Other lawsuits that have been filed include Laurel Beth Rayani claiming to be owed $2.42 million, Cory Edgar claiming $367,190, WealthSense Financial claiming it is owed $117,914, Nicholas and Jennifer Fitterer and Nicholas Fitterer Inc. claiming together they are owed $704,099, Jacky Jia Jie Ng and Joyce Olivia Yung claim to be owed $531,026 and Vincent Darryl Taylor claims to be owed $2.3 million.
Attempts to contact Martel were not successful Friday.
In response to questions from the Times Colonist, the B.C. Securities Commission said “to preserve the integrity of the investigative process, the BCSC does not discuss investigations, nor does it confirm or deny the existence of investigations.”
The B.C. RCMP said it is not in a position to confirm or deny if there is a criminal investigation underway regarding the claims, and that only when Crown counsel approves criminal charges could the RCMP comment.
The Victoria Police Department said it can’t comment on potential investigations unless there’s a clear public safety or investigative need.
