Victims of Ian Thow deal with stress, health issues and a death 17
months after scandal broke
They still meet almost every month, though their numbers are dwindling.
Their resolve and enthusiasm remains, but it's been tempered over the
last 17 months by a series of disappointments and personal tragedy.
They are the victims Ian Thow left behind. And they are still being
churned by the wake Thow left behind when he fled the country amid
allegations he owed in excess of $37 million to clients and creditors
after convincing them to invest in schemes that ranged from a Jamaican
bank to loans for Vancouver developers and seed shares with his former
The former vice-president of Berkshire Investment Group left the company
at the end of May 2005, filed for bankruptcy in Canada and the U.S. and
fled Victoria. He has been living in Seattle since August 2005 with his
second wife, Alyssa, avoiding 73 former clients and unsecured creditors.
His former clients are still coming to terms with what transpired.
"The stress on all of us has been really bad ... all of us are showing
it in some way health-wise," said Shirley Garwood, who along with sister
Helena Kells claim Thow owes them $455,000.
"We're not nearly as well as we were before all this happened."
Garwood said the stress was a major contributor to Kells' heart problems
-- she had a bypass earlier this year -- as it did to another member of
the group who also had heart surgery.
Irving Lozier, 86, a retired teacher and another member of the creditor
group who along with wife Joyce was owed $350,000, died in October.
In a series of interviews earlier this year the affable Lozier
maintained his sense of humour, but admitted the stress was taking a
toll on him and his wife.
"We've gone from being very happy and comfortable, in retirement with no
debt and a house that's paid for, to just having my teacher's pension
and old age security -- that's all we've got. It's so frustrating."
Lozier said this summer.
Ron Black was feeling similar stress. Like the rest of the creditor
group, he had the wind taken from his sails when Lozier died. "This is a
stress and you don't realize just how much until you sit back a bit and
look at what's happened," he said.
Black, 86, said his health has improved recently, owing in large measure
to the fact he finally settled his affairs with Berkshire. He claimed
Thow owed him in excess of $700,000.
The settlement amount was not disclosed. As in all cases, the creditors
signed confidentiality agreements with Berkshire. After mediation in the
spring, Berkshire settled 15 claims with 26 of the former clients, but
Black had been left out during the first round of settlements because of
"Life's a little easier now. I mean (Thow) had wiped me out and I had to
sell my house. At least now I can afford to live in a decent one-bedroom
apartment," Black said, noting he's still getting used to living in a
much smaller space in James Bay.
While some creditors have received a portion of their investment back
from Berkshire, there are others who have yet to see a cent. The 15
claims settled represents only a small fraction of the $37 million that
is allegedly missing. It is estimated those settlements were dealing
with about $5 million in lost funds. The bulk of it has yet to be dealt
with, and there's no indication compensation will be coming soon.
Much of the money was tied up in the Jamaican bank scheme, which saw
Thow allegedly selling shares in the National Commercial Bank of Jamiaca
which is majority owned by Berkshire founder Michael Lee Chin's AIC
"Absolutely nothing has happened ... we've heard nothing from
Berkshire," said Brad Goodwin, whose family claims it's owed $1.4
million by Thow. "(Berkshire) promised they'd deal with us but it seems
they are reneging on it."
Repeated calls to Berkshire over the last week have not been returned.
While it doesn't appear related to the Thow affair, Berkshire founder
Lee-Chin stepped down in October from AIC, the mutual fund company he
owns. He then appointed Jonathan Wellum as CEO of AIC Ltd.
Changes were also made at Berkshire where Geoffrey Charlton was replaced
by Vancouver-based Bob Levis as CEO.
The only other developments in the Thow affair have the B.C. Securities
Commission finally setting dates next summer for the hearing into Thow's
actions. The commission will hold the hearing May 29 to 31, June 4 to 6,
June 8 and June 13 to 22 to determine if it is in the public interest to
take action against Thow.
The BCSC's notice of hearing states that from January 2003 to May 2005,
Thow is alleged to have made false representations in telling clients he
was able to invest money for them in various securities. It is further
alleged he used some or all of the clients' money for his personal use.
The notice alleges Thow breached the Securities Act and related rules by
failing to deal fairly, honestly and in good faith with his clients;
trading in non-mutual-fund securities for which he was not registered;
and making misrepresentations in the selling of securities.
It is unlikely Thow will attend the hearings in person. If he crosses
the border into Canada he may be arrested stemming from a breach of the
Insolvency and Bankruptcy Act. He removed items from his home after his
assets had been frozen and an interim receiver was appointed. The
bankruptcy trustee, Michael Cheevers of Vancouver- based Wolridge Mahon,
filed for an arrest warrant Sept. 19, 2005.
Thow also had legal problems in Seattle this summer. He was arrested in
July on domestic-violence charges. According to records from the King
County prosecutor's office, Thow was charged with assault, interfering
with reporting domestic violence and harassment and was released on
$5,000 bail. He is probation for two years.
The RCMP Integrated Market Enforcement Team is also investigating Thow,
but no charges have been laid. While the RCMP did not return calls,
representatives have reportedly told the creditor group they hope to
approach the Crown about charges before year's end.