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Ex-clients cite victory as court orders Ian Thow's assets frozen

 

Andrew A. Duffy, with files from Richard Watts
 

Thursday, July 14, 2005

Two days after former Berkshire investment adviser Ian Thow broke his silence, the courts slapped him with an injunction freezing his worldwide assets.

Calling it a win, Katherine Ducey, the lawyer for the Goodwin family of Richmond -- former Thow clients who have filed suit seeking $1.05 million -- said the courts have granted an injunction preventing Thow from liquidating his assets.

"It says he's not supposed to transfer or dispose of any of his assets before trial ... to make sure there's something left," she said.

When asked to estimate the worth of Thow's assets, Ducey would only say, "It's difficult to know what, if anything, he has."

Ducey says Thow now has 14 days to provide them with a list of his assets and the amount of money he requires to live. She said they have asked for a list of all assets owned by Thow and his companies, but not those in his wife's name.

"But theoretically anything in her name that actually belongs to him should be listed," she added.

The freeze comes just two days after Thow filed an affidavit in Vancouver in response to the Goodwin lawsuit which alleges the former Berkshire mutual fund salesman advised members of that family to buy into an investment scheme involving the National Commercial Bank of Jamaica.

According to writs filed in B.C. Supreme Court and the Court of Queen's Bench of Alberta, the Goodwins' suit -- and three others -- revolve around a scheme that had clients writing cheques to Thow's numbered company with a view to purchasing shares in the NCB 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.

In his affidavit, Thow denies advising the Goodwins to enter such a scheme. He also pointed out he was a mutual fund adviser -- "As such, I did not have the authority to put client's funds directly into stocks."

Later in the affidavit Thow adds: "I may have suggested that an investment in NCB would be a good idea, but I did not ask them to make such an investment through me and I did not tell them to borrow funds against the equity in their homes to buy shares in NCB."

And while Thow admits he did make comments to Brad Goodwin about their investments doing well, he did not "recall ever telling him that they had doubled, tripled or quadrupled in value. My comments were with reference to the mutual funds investments that they were making through Berkshire (which again, did not include any NCB shares)."

In his affidavit, Thow says he has "given a mortgage to Harper Grey LLP (more specifically to HGE Management Co. Ltd., a corporation associated with Harper Grey LLP) to secure future legal fees."

Property documents and land titles information reveal Thow was granted a $250,000 mortgage on his Saanichton home last week. The mortgage was granted on July 6 at an annual interest rate of eight per cent with a balance due date listed as "ON DEMAND."

HGE Management of Vancouver granted the mortgage despite the existence of other encumbrances on the property at 8338 West Saanich Rd., assessed at $4.1 million in 2004.

Ahead of HGE are The Bank of Nova Scotia, which holds another mortgage. Also, three builder's liens are listed against the property while two other builder's liens are now working their way through the application process.

Calls to Thow's Vancouver-based counsel Rod Anderson requesting an interview were not returned.

aduffy@tc.canwest.com