Nova Scotia investment scam mastermind ordered to pay victims $1.1 million

By Aly Thomson

THE CANADIAN PRESS

HALIFAX _ The Nova Scotia financial manager behind an investment scam “paid a hard price for his greed,” a judge said as she ordered him to pay back about 200 investors he bilked out of $1.1 million.

Quintin Sponagle of Upper Vaughan, N.S., pleaded guilty to fraud in December.

The charge involved 201 people who invested more than $4 million through Jabez Financial Services Inc. a Windsor, N.S., company registered in Panama. Sponagle has admitted he was responsible for $1.1 million that was not invested.

He used that money to buy cars, recreational vehicles and property and for international travel, cash withdrawals and other personal expenses, Judge Anne Derrick said in a new decision.

Derrick said he used other people’s hard-earned money to “feather his own nest,” and ordered Sponagle to pay the victims $1.1 million in restitution.

“Mr. Sponagle betrayed his investors and whatever moral code he may have had, primarily so he could live the good life and enjoy material benefits that otherwise would presumably have been beyond his means,” said Derrick.

“The fact that no restitution has been made by Mr. Sponagle in the over 10 years since his fraud was … means that these many victims have had their trust betrayed and have suffered harm, in some cases irreparable harm, to their future plans, to the security they were counting on for their retirements, and to their health, well-being and happiness.”

Derrick also accepted a joint recommendation from Crown and defence lawyers to sentence Sponagle to a year’s probation and time-served in jail.

Sponagle spent 19 months in Panama’s La Joya Penitentiary described by the judge in this case as “one of the world’s worst prisons.”

“He has paid a hard price for his greed,” she said of his time imprisoned in Panama.

Sponagle was brought back to Nova Scotia in November 2014 and released on bail a month later after posting a $45,000 surety.

The judge said victim impact statements revealed Sponagle’s actions affected the investors emotionally, mentally and physically, and shook their trust in others.

Many victims were from Sponagle’s “immediate social group,” she said.

“I have no doubt that Mr. Sponagle was seen by his hapless investors as an upstanding fellow citizen who provided no reason for anyone to mistrust him,” the judge said. “Mr. Sponagle used the trust he had been accorded by vulnerable and naive victims for his personal benefit.”

In October 2011, the Nova Scotia Securities Commission found Sponagle and Trevor Hill engaged in unfair practices, solicited investments without being registered in Panama or Canada, and failed to file a prospectus before distributing securities.

The commission concluded that between April and September 2006, the pair traded securities after receiving $4.1 million from 137 residents of Nova Scotia and 52 residents of other provinces.

“Mr. Sponagle spent investors’ money on himself, and indulged friends, relatives and business associates including Mr. Hill and his family,” the commission said in a statement dated Oct. 20, 2011.

The commission said the pair’s actions amounted to a “deceptive and dishonest ruse, designed to extract money from trusting and unsuspecting Canadian investors. It was in the nature of a ‘Ponzi scheme.”

It said Sponagle was the “mastermind of this scam,” and it banned both men from becoming or acting as a director or officer of any publicly traded company, or acting as an investment fund manager or promoter.

They were also ordered to each pay a $500,000 fine the maximum penalty at the time.

Auditors recovered about $2 million from Sponagle’s accounts, but only a portion was returned to investors, once financial fees were covered.

New FireSmart Home Development Guide helps Canadians build wildfire resiliency

FireSmart Canada, in partnership with The Co-operators, has developed a new resource to help residents make their homes more resilient to wildfire. The FireSmart Home Development Guide is now available to all Canadians, and will become part of the FireSmart Home Partners Program.

The FireSmart Home Development Guide outlines specific measures homeowners can take to reduce the risk of damage from wildfire.  Available to help homebuilders and property owners make informed decisions, the Guide provides recommendations on elements that significantly reduces the wildfire risk a home faces: roofing material and design; siding and vents; gutters and eaves; decks; fencing; and landscaping.

“Canadians have seen the devastating personal, social and economic impact of wildfires, the most tragic of which occurred in Fort McMurray last year,” said Rob Wesseling, president and CEO of The Co-operators. “Fortunately, we know that proactive mitigation efforts by individual property owners can significantly reduce wildfire risk. By making the FireSmart Home Development Guide available, we are hoping to inspire homeowners to take action to protect what matters most – their loved ones and property.”

The Guide will also now be part of the FireSmart Home Partners Program, which is being piloted in four communities: Fort Nelson First Nation, B.C., Northern Rockies Regional Municipality, B.C., Slave Lake, Alta. and Whitecourt, Alta. The Program addresses the need for a standardized system that offers detailed, customized and measureable wildfire risk assessments and measurable risk reductions for individual properties. In the future, it will also include in-person workshops for insurers, realtors and homebuilders.

“Any place where conditions allow for ignition and spread of fire between structures and vegetation – the wildland-urban interface – people are more exposed to the risk of wildfire, and that needs to be considered and managed by all stakeholders, including property owners,” said Kelly Johnston, executive director of FireSmart Canada. “Preparing for the threat of wildfire is a shared responsibility that will only grow in importance as climate change and other factors continue to increase the risk. The FireSmart Home Partners Program provides homeowners with the tools and information to reduce the risk of wildfire to their homes.”

The Co-operators also partners with FireSmart Canada and other organizations on Wildfire Community Preparedness Day (WCPD), which will be held this year on May 6, 2017.

The FireSmart Home Development Guide is available at firesmartcanada.ca.

About FireSmart Canada
FireSmart Canada is the go-to national program committed to helping Canadians reduce their wildfire risk and become fire adapted through community-based solutions.  FireSmart is administered by Partners in Protection; a non-profit coalition of federal, provincial, indigenous communities, private industry and municipal fire, emergency and land management experts. Through publications, programs, outreach training, and workshops, FireSmart Canada provides tools for Canadians to become pro-active in reducing the risk of wildfire to their homes and communities. FireSmart programs and products are supported through membership and ongoing active support from organizations such as the Canadian Interagency Forest Fire Centre, the Institute for Catastrophic Loss Reduction, the National Fire Protection Association and The Co-operators. For more information on FireSmart visit www.firesmartcanada.ca.

About The Co-operators:
The Co-operators Group Limited is a Canadian co-operative with more than $44 billion in assets under administration. Through its group of companies it offers home, auto, life, group, travel, commercial and farm insurance, as well as investment products. The Co-operators is well known for its community involvement and its commitment to sustainability. The Co-operators is listed among the 50 Best Employers in Canada by Aon Hewitt; Corporate Knights’ Best 50 Corporate Citizens in Canada; and the Top 50 Socially Responsible Corporations in Canada by Sustainalytics and Maclean’s magazine. For more information visit www.cooperators.ca.

SOURCE The Co-operators

One year later: A look at the Fort McMurray wildfire and rebuild by the numbers

FORT MCMURRAY, Alta. _ It’s been one year since a wildfire devastated parts of the northern Alberta city of Fort McMurray. Here is a look at the rebuild by the numbers:

1,595: Number of buildings and structures destroyed in the fire. Includes 2,579 dwelling units.

650: Approximate number of development permits issued by Fort McMurray since the fire, representing about 900 dwelling units.

222: Number of single-family homes started in the first three months of the year. Most starts in a three-month stretch since early 2008.

179: Number of homebuilders that have registered under new disclosure laws to do work in the Regional Municipality of Wood Buffalo.

33: Approximate number of families living in rebuilt homes as of the start of April.

48,000: Roughly the total number of insurance claims expected to be processed. Includes 12,000 auto claims and 25,000 home claims.

$80,000: Average insurance payout per claim.

$3.8 billion: Estimated total payout in insurance claims.

9.8: Unemployment rate for the Wood Buffalo-Cold Lake area as of March 2016.

9.1: Unemployment rate for the Wood Buffalo-Cold Lake area as of March 2017.

600: Approximate decline in student numbers in public and Catholic schools for 2016-2017 year. Total enrolment slightly more than 11,000 between the two school systems.

1.5 million: Average barrels of oil per day produced from the oilsands before the fire.

3 million: Record high number of barrels per day produced from the oilsands in November, six months after the fire.

12,000: Estimated number of fridges and freezers that had to be replaced, according to Insurance Bureau of Canada.

$660,000: Median home price in March 2016 on 21 homes sold.

$560,000: Median sale price of the 45 single detached homes sold in March.

11: Number of single family vacant lots sold in March, at a median sale price of $156,000, compared with none sold in March 2016.

17.8: Total vacancy rate for Wood Buffalo as of October 2016. A year earlier it stood at 29.3 per cent.

29,068: Number of mental-health-related client contacts between May 10, 2016, and March 18, 2017, at Alberta Health Services Addiction and Mental Health in Fort McMurray and Wood Buffalo.

$189 million: Total amount of money donated to the Red Cross.

$134 million: Total value of donations that were matched by the federal and provincial governments.

$231 million: Total amount the Red Cross says it has allocated to support individuals and families.

$30 million: Total amount the Red Cross says it has allocated to support small businesses.

$50 million: Total amount the Red Cross says it has allocated to support community groups.

10,900: The number of plane and bus tickets the Red Cross booked to help people return home.

37,000: The number of cleanup kits handed out to returning evacuees.

6,000 per cent: The surge in social media traffic the Red Cross saw in the aftermath of the fire.

40: The number of volunteers required to manage the Red Cross social media accounts.

Leaving money to a secret beneficiary is very, very tricky, experts warn

Leaving money to a secret beneficiary is very, very tricky, experts warn

By David Hodges

THE CANADIAN PRESS

TORONTO _ When it comes to requests to have inheritance money left discreetly, Toronto estate lawyer Ed Olkovich says it’s typically not the racy stuff most people might expect, such as funds for a secret lover or a child out of wedlock.

Rather, he says, it’s often done to avoid having something that could appear unseemly included in a will _ which becomes a public document once it’s probated.

“I’ve had a strange case where somebody said to me, ‘Don’t put that person’s name in the will because my partner will go crazy if I left this person money,”’ Olkovich says, citing the example of a client wanting to leave a sizable gift to a loyal employee without raising any suspicions from his wife.

“The next thing you know, somebody is accusing them of having an affair.”

But regardless of why you may want to leave money for a secret beneficiary, there are lawful ways to do it, says Ottawa-based estate lawyer Norman Bowley.

One option is to make arrangements with a trust company legal entities often used when dealing with estate planning matters that administer the money either during your lifetime or after your death.

“They’re discreet and professional and you would literally put in the trust, ‘When I die you are to give this $100,000 to such-and-such-a-person,”’ says Bowley. “That is not going to get out in the public, provided that you take the care to use an instrument for which you don’t need probate.”

Another option for leaving money confidentially is a secret trust in which you leave assets to a person named in your will with prearranged instructions that they privately give the funds to someone else who has not been named in the will.

For instance, Bowley says, you could leave money to a sibling, with the understanding that they would give the funds to your secret beneficiary “a mistress, for instance.” That means the gift is secret even after the will becomes public.

However, enforceability of a secret trust may be a concern because there is little you could do to ensure your wishes are actually carried out. Bowley says that “if your brother turns out to be a scalawag after your death, he may just keep the money for himself.”

An altogether different option is a permanent insurance policy that guarantees a payment, says Lorne Marr of LSM Insurance in Markham, Ont.

“The owner of the policy can choose whoever they want as the beneficiary, so long as they’re is an insurable interest” says Marr.

“But the nice thing about an insurance policy also is that it supersedes the will,” he adds, meaning that whatever you designate in your insurance policy is not part of your estate and therefore subject to probate.

But in terms of the actual pay out, the insurance company needs two things from the beneficiary: a claimant’s form explaining their relationship to the insurer, as well as a copy of the death certificate the latter of which could be tricky, Marr says.

Olkovich points out, however, that while an insurance company won’t tell you who a designated beneficiary is, that doesn’t mean the policy becomes confidential.

“If it’s for a large sum of money a court can order that information to be disclosed,” he says.

Generally, Olkovich says, the difficulty with trying to leave money in secret is that after you’re gone it’s no longer a secret once the beneficiary actually starts receiving the funds.

“If all of a sudden a large sum of money is missing out of your account, someone is going to follow that paper trail and they’re going to say, ‘Well, whatever happened to this money?”’

 

$45M insurance claims from March windstorm in eastern Newfoundland

Excerpted article was By Marilyn Boone, CBC News

Insurance companies have tallied the cost of a March blizzard that whipped through eastern Newfoundland and says damage claims covered by insurance add up to $45 million.

Hurricane-force winds on March 11 gusted more than 140 km/hr damaging residential and commercial buildings, vehicles and power lines.

Siding and roofs were stripped from houses, traffic lights were torn from their posts and windows were blown out of vehicles.

More than 70,000 people were without power, some for more than a day.

Winds were so strong in St. John’s that windows were blown out of vehicles in the Stavanger Drive area.

What happened is known in the insurance world as a catastrophic event, according to Amanda Dean, Atlantic vice president of the Insurance Bureau of Canada

“In the insurance industry, anything over 25 million is considered a catastrophic event,” Dean said.

The March 11 storm, on a Saturday, had residential and commercial clients calling their insurance companies the next day.

The storm came just months after remnants of Hurricane Matthew — in October 2016 — which resulted in $100 million worth of insurance claims by customers in Newfoundland and Nova Scotia.

In 2010, Hurricane Igor resulted in $75 million in insurance claims. Those figures from the insurance industry do not include damage to public infrastructure such as roads and bridges.

“One event doesn’t necessarily affect insurance rates,” Dean said, but noted that catastrophic events are happening more frequently.

Premiums charged are meant to fill up the pool of money that’s available to pay out claims and “once the pools are depleted, they have to be filled back up.”

Bay Roberts wharf

The wind ripped off the roof of this building on the Bay Roberts wharf, just one of the structures damaged in the March 11 storm. (Phil Smith/Twitter)

Fort McMurray is missing an opportunity to make itself more fire-resilient as it rebuilds, an insurance expert says.

Read more

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