Investors Scrutinizing the Regulators

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Former adviser not licensed to sell stock
Ian Thow's 'outside business activities' led to investigation, former employer says


Andrew A. Duffy

Thursday, July 07, 2005

Berkshire Investment Group is stepping up its campaign to distance itself from Ian Thow, one of its former senior investment advisers who resigned at the start of June.

Burlington, Ont.-based Berkshire is expected to run a newspaper ad this weekend which seems designed to assuage their clients concerns over Thow's "outside business activities."

The content of the ad notes Berkshire is co-operating with authorities in the investigation of Thow's outside business activities and again made clear Thow is no longer with the firm.

"Berkshire has no ongoing business relationship of any kind with Ian Thow -- during the course of our investigation into his outside business activities, Mr. Thow resigned. We would like to confirm outside business activities are activities unrelated to the sponsorship of his mutual fund licence," reads the ad.

"When we learned of the allegations, we brought them to the attention of the securities' regulators and police authorities. We intend to co-operate in the investigation into this matter."

Both the B.C. Securities Commission and the Vancouver RCMP Integrated Market Enforcement Team are said to be making inquiries into Thow's activities.

Thow and Berkshire are named in four separate lawsuits that revolve around an investment scheme in the National Commercial Bank of Jamaica.

Berkshire spokeswoman Alison Fletcher said that while the company has not yet filed a statement of defence it "will obviously be vigorously defending the charges against them."

Fletcher reiterated the company's position that it is Thow's business activities outside of Berkshire that have drawn out lawsuits from his clients.

Fletcher also said Thow was not even licensed to sell clients shares in the Jamaican bank.

"He was only licensed to sell insurance and mutual funds," she said.

To date, Thow has been named in four lawsuits totalling about $3 million. According to writs filed in B.C. Supreme Court and the Court of Queen's Bench of Alberta, the suits revolve around a scheme that had clients writing cheques to Thow's numbered company with a view to purchasing shares in the National Commercial Bank of Jamaica to be held in trust for those clients.

Those court documents allege Thow was telling his clients their investments were soaring; however, when the clients demanded their money, they received either a small fraction of their investment or nothing at all.

It is believed these lawsuits are only the first of many to be filed.

There are also two lawsuits that have been filed in Victoria revolving around Thow's offices at the Reef development at 21 Erie St.

In a petition to the court, Reef Condominium Development is seeking a declaration that the mortgage on Thow's suite is in default and seeks $522,785.57 in payments owed and secured by the mortgage.

Ashcore Building Corporation is also suing Thow with respect to the office. Ashcore seeks $252,398.64 for the work done to build the striking two-level space.

The stunning space with a dark-glass rotunda which looks out onto Shoal Point has now been cleared of all materials save for a few chairs, tables and fixtures.

-- with files from CanWest News Service



Ian Thow takes flight