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Salmon Arm man made misleading statements to investors: BC Securities Commission

Sanctions to be imposed after submissions from commission staff and the accused
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A Salmon Arm man and his mortgage investment corporation, All Canadian Investment Corporation, ACIC, was found by the BC Securities Commission on July 29, 2021 to have made misrepresentations and false or misleading statements in documents required to be filed under the Securities Act. (File photo)

A Salmon Arm man and his mortgage investment corporation were found by the BC Securities Commission to have misled investors.

The misrepresentations and false or misleading statements were made in documents required to be filed under the Securities Act.

In a news release regarding the findings on July 28, 2021 following hearings, the BCSC stated that Donald Bergman was the sole director of All Canadian Investment Corporation (ACIC), which provided loans to owners and developers of residential and commercial real estate. The loans were secured by mortgages on the properties.

ACIC raised $1.6 million from 56 investors between January 2014 and December 2015 through three offering memorandums that explained how the loans would be secured. Such a memorandum must contain specific information about an investment to help potential investors make a decision about whether to purchase the security.

The memorandums said the mortgages, on properties in various areas such as the Lower Mainland and the Sunshine Coast, would be registered in the appropriate land title office, and were the first or second mortgage on the property. However, ACIC did not register some of the mortgages and cancelled some of the registrations. Also, some of its mortgage loans were secured by mortgages that ranked lower in priority than represented in the documents.

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Starting in 2015, stated the BCSC, dividends to ACIC investors dwindled. In 2017, the Supreme Court of British Columbia appointed a monitor to assist ACIC in the liquidation of the company’s assets. Losses for preferred shareholders were estimated to be between 81.9 per cent and 96.1 per cent.

The panel found that Bergman and ACIC made false or misleading statements in the offering memorandums because some of the loans were not secured as promised. The difference between the offering memorandums’ statements and the truth, the panel said, concerned issues “of fundamental importance to investors […] as these representations went to the safety and security of their investment.”

The panel, which also found that Bergman and ACIC made misrepresentations to investors, will impose sanctions after considering submissions from BCSC staff and the accused. The document outlining the BCSC’s findings can be found at www.bcsc.bc.ca under ‘decisions and orders.’



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Martha Wickett

About the Author: Martha Wickett

came to Salmon Arm in May of 2004 to work at the Observer. I was looking for a change from the hustle and bustle of the Lower Mainland, where I had spent more than a decade working in community newspapers.
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