\n\tA Quebec court has ruled against a former client of convicted fraudster Earl Jones, who was suing Industrial Alliance Insurance and Financial Services Inc. over a loan allegedly arranged by Jones without the client’s knowledge.<\/p>\n
\n\tQuebec Superior Court Judge Pierre Tessier ruled in favour of Industrial Alliance, and a notary, Linda Frazer, who were sued by Grace Electra McMaster, a long-time client of Earl Jones, over an investment loan Jones allegedly arranged for her under his power of attorney.<\/p>\n
\n\tJones was arrested in 2009, pled guilty to two counts of fraud amounting to more than $50 million, and has been sentenced to 11 years in prison.<\/p>\n
\n\tIn the McMaster case, the decision handed down on May 18 indicates that Jones arranged a $367,250 loan from Industrial Alliance in 2006, secured against McMaster’s home, using a power of attorney she granted him back in 1991 to handle all of her financial affairs. McMaster claimed she wasn’t aware of the loan, the proceeds of which were held by Earl Jones, and charges that Industrial Alliance did not act prudently in loaning the money, and failed to properly verify if she consented to the loan.<\/p>\n
\n\tIndustrial Alliance and the notary that helped arrange the loan both denied liability and sought dismissal of the action. The firm claimed that the money was loaned without any negligence, and that the plaintiff was aware of it. It sought full payment of the loan.<\/p>\n
\n\tUnder an agreement with the firm, McMaster sold the property that secured the loan in September 2010, and about $380,000 of the proceeds were placed in trust pending the outcome of the case. She was to get those funds if she succeeded in getting the loan cancelled, and Industrial Alliance would get them if she didn’t.<\/p>\n
\n\tThe court found in the firm’s favour, ruling that there was no negligence on its part in approving the loan. It also found that the notary was justified in believing that plaintiff was aware of the loan, and that Earl Jones was authorized to sign on her behalf.<\/p>\n
\n\t“Plaintiff had full and blind confidence in Earl Jones for some 18 years. He is the only one responsible for the loss claimed,” the decision notes. And so, her action against both defendants should therefore be dismissed, the court said.<\/p>\n
\n\tThe court ordered that the money held in trust from the sale of the house be paid to Industrial Alliance, and that the loan be discharged as a result.<\/p>\n
\n\tThe decision also noted that the plaintiff in this case was part of a class action against Royal Bank over the trust account of Earl Jones held at an RBC branch in Beaconsfield, Que., and that suit may provide her with some compensation. That suit was settled for $17 million back in March.<\/p>\n","protected":false},"excerpt":{"rendered":"
No negligence on the part of Industrial Alliance in approving loan, Quebec court rules<\/p>\n","protected":false},"author":38954,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[2312,2318],"tags":[2514],"yst_prominent_words":[],"acf":[],"_links":{"self":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/289687"}],"collection":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/users\/38954"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/comments?post=289687"}],"version-history":[{"count":0,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/posts\/289687\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/media?parent=289687"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/categories?post=289687"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/tags?post=289687"},{"taxonomy":"yst_prominent_words","embeddable":true,"href":"https:\/\/www.investmentexecutive.com\/wp-json\/wp\/v2\/yst_prominent_words?post=289687"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}