Investors who lost an estimated $33 million in connection with a real estate investment fraud are poised to recover about $2.1 million, according to the British Columbia Securities Commission (BCSC).
In 2016 a BCSC hearing panel found that sisters Siu Mui “Debbie” Wong and Siu Kon “Bonnie” Soo defrauded investors and illegally distributed securities as part of a property development scheme. The scheme included misappropriating $1.2 million of investors’ money, using the money for unapproved purposes, and acquiring land — from a company they controlled — at inflated prices and selling units to investors at the inflated valuation.
In 2017 a regulatory hearing panel ordered $22 million in sanctions against them, including $6 million in penalties against each sister and about $10 million in disgorgement against them and various companies. They were also banned from the industry.
Now, the BCSC says the court-appointed receiver in the case, MNP Ltd., has recovered about $2.1 million, primarily from the sale of properties involved in the scheme. The proceeds will be distributed to the 92 victims that submitted a claim in the case.
According to MNP’s latest report based on filings in various legal actions, collective investor losses are estimated to be about $33 million. The money collected by the receiver ($2.1 million is net of the costs of the receivership, which totalled almost $800,000) will be paid to harmed investors on a pro-rated basis. Approved claims total about $12.6 million.
“The receiver went to great lengths to gather assets for the benefit of victims of this devastating fraud,” said Doug Muir, director of enforcement with the BCSC, in a release. “This case highlights the importance of using our powers under the Securities Act to enforce our financial orders and get money back to victims of investment fraud.”