What is Bankruptcy?
This page is for information purposes only and you should consult your professional adviser.
Page last updated: May 9, 2017
This page is for information purposes only and you should consult your professional adviser if you have any questions or are uncertain as to your rights or obligations.
On May 4, 2017, the Court approved the final statement of receipts and disbursements for the estates of PFK and FMC, the Trustee's additional fees, the final distribution to the creditors of FMC and the Trustee's discharge in each estate subject to completing its remaining duties as set out in the Trustee's Seventh and Final Report. The Trustee will commence processing dividend cheques for the proven creditors of FMC during the week of May 8, 2017.
On April 7, 2017, the Trustee filed its Seventh and Final Report seeking approval of the Trustee's Final Statement of Receipts and Disbursements ("Final R&D") and Dividend Sheets in respect of the estates of Peers Foster Kristiansen Inc. ("PFK") and Federal Mortgage Corporation Ltd. ("FMC") along with seeking approval of the Trustee's discharge in each of the estates.
The Trustee’s application is scheduled to be heard on May 4, 2017 at 10:00am in Edmonton, Alberta. Notice of the Trustee’s application were sent to proven creditors of PFK and FMC on April 4, 2017, copies of which are posted in the Final Distribution and Discharge section of the website.
On December 12, 2016 the Trustee held a final inspectors meeting to approve the Trustee's Final Statement of Receipts and Disbursements ("Final R&D") and Dividend Sheets in respect of the estates of Peers Foster Kristiansen Inc. ("PFK") and Federal Mortgage Corporation Ltd. ("FMC") along with seeking approval of the Trustee's discharge in each of the estates.
At this meeting the Inspectors approved the Final R&Ds and Dividend Sheets, copies of which are posted in the Final Distribution Documents tab of this website. As noted in the Trustee's Sixth Report, the Trustee anticipated a distribution to the unsecured creditors of FMC totaling approximately two cents per dollar of proven claim. The FMC Final R&D reflects a distribution of 2.63 cents on the dollar. With respect to PFK, there will be no distribution to PFK's unsecured creditors as there is a shortfall of approximately $4.2 million to Said Arrata (the first ranking remaining secured creditor) and a $16.5 million shortfall to the next secured creditor, FMC.
On January 18, 2017, the Trustee sent the Final R&Ds and Dividend Sheets to the Office of the Superintendent of Bankruptcy, along with a number of other documents for comment. Once comments are received from the Superintendent, the Trustee will apply to Court for approval of its accounts, approval of the distribution to FMC's unsecured creditors and the Trustee's discharge (the "Approval Hearing") in respect of the estates of PFK and FMC. Any creditor objecting to the Final R&Ds and Dividend Sheets or the Trustee's discharge are required to file an application with the Court prior to the Approval Hearing, on notice to the Trustee, setting out the reasons for their objection. If no creditor objects and the Court approves, the Trustee will distribute the dividends. Further information will be posted on this website regarding the Approval Hearing date with notices being mailed out to the proven creditors in each estate regarding the same. The Trustee anticipates the Approval Hearing to take place in March/April 2017.
Given the length of time the administration of the estate has taken, the Trustee believes there is a possibility that some of the addresses reflected in the proofs of claim filed by certain creditors whose claims were accepted may have changed. Accordingly, the Trustee requests that creditors whose claims have been accepted in FMC (as reflected in the Dividend Sheet), and have changed their address since 2010, to email the Trustee with their updated address by clicking the email link at the top right corner of this page. This updated information will be of particular importance for the mailing of dividend cheques to proven creditors of FMC.
As noted in the Trustee's Sixth Report, the Trustee anticipates a small distribution to the unsecured creditors of Federal Mortgage Corporation Ltd. ("FMC") totaling approximately two cents on the dollar. The Trustee has recently completed its review of approximately 375 claims totaling $40 million filed in the FMC estate. On June 14, 2016, the Trustee issued Notices of Disallowance or Revision in respect of nine claims totaling approximately $1.6 million. Pursuant to the Bankruptcy and Insolvency Act, claimants who are not satisfied with the Trustee's decision in disputing their claim have 30 days from the date of the notice to appeal to Court. Once the 30 day period has expired, the Trustee will convene an Inspectors' Meeting shortly thereafter to approve the dividend sheet and Trustee's final Statement of Receipt and Disbursements ("R&D"). Subject to Inspector approval, the Trustee will submit these documents to the Superintendent of Bankruptcy for comment. Once comments are received from Superintendent, the Trustee will proceed to Court within 30 days for taxation of its accounts and after taxation, the Trustee will send to every creditor who has proved its claim, a copy of the final R&D, Dividend Sheet and a notice to pay a final dividend. If no objections are made with respect to the R&D and dividend sheet, the Trustee will issue dividend cheques to FMC's creditors.
With respect to the claims of creditors in the estate of Peers Foster Kristiansen Inc. ("PFK"), as noted in the Trustee's Sixth Report there was a shortfall in respect of the secured claim of Said Arrata. Accordingly, there will be no distribution to the unsecured creditors of PFK.
On February 12, 2016, the Court granted the orders sought by the Trustee as outlined in the Trustee's Sixth Report.
On Monday, February 8, 2016 Jay Peers pleaded guilty Monday in provincial court to 11 of the 33 original counts filed by the Alberta Securities Commission for breaching Alberta’s securities laws. In addition, his son Robert Peers, also pleaded guilty to one count. The 11 guilty pleas by Jay Peers are as follows: two counts of perpetrating a fraud on investors; five counts of making untrue or misleading statements regarding investing in PFK and FMC; one count of allowing FMC to make untrue or misleading statements to investors; one count of distributing securities without filing a prospectus or using an applicable exemption; and two counts of acting as a dealer and adviser without registration.
On February 1, 2016, the Trustee filed its Sixth Report to inform the Court of the Trustee’s activities since the date of its appointment and to seek approval of the matters as set in paragraph 1.4 of the Sixth Report. The application will be heard on February 12, 2016.
Canyon Ridge Development
As noted in the July 9, 2013 update, one of the remaining FMC assets to be realized are the Canyon Ridge lots in Golden BC. To date, approximately 20 lots have been sold with the proceeds used to pay off the mortgage registered against the properties. There are 5 remaining unsold lots which have been proven difficult to sell over the last year given the current market conditions in the area. However, we have been advised that the market is beginning to improve and that these lots will present a good buying opportunity for prospective purchasers.
Accordingly, the Inspectors have authorized a further slight price reduction on these remaining lots in an effort to increase interest and saleability. Set out below are the updated list prices. Interested parties should contact the realtor, Mr. Bob Tegart of Re/Max Golden, at (250) 272-4321 or via email at email@example.com.
|Lot#||Civic Address||Adjusted List Price|
|Single Family Lots|
|36||1565 Quartz Crescent||50,000|
|37||1569 Quartz Crescent||47,250|
|38||1573 Quartz Crescent||50,000|
|63||1398 Pine Drive||55,500|
|64||1400 Pine Drive||55,500
Investment Accounts (RESP, RRSP, RRIF and other accounts)
Throughout the bankruptcy proceedings, we have received numerous telephone calls from investors regarding deemed distributions of funds held in RRIFs or other accounts. As the administration of these investments is outside the bankruptcy, the Trustee has advised the investors that it no ability to affect these accounts.
The trust companies holding these investments have advised us that it is only after the Trustee has provided them with the final dividend sheet that they are able to conclude what value the company may have and then close the accounts as appropriate. Given the conclusion of the administration of the estate has been protracted due to a number of investigations being carried out by various regulatory and policing agencies, as well as the challenges in monetizing the few remaining assets, the Trustee might not be in a position to finalize the file in the near future.
Therefore, in an effort to assist the investors the Trustee sent a letter to Canadian Western Trust on March 27, 2014 suggesting all efforts be made by Canadian Western Trust to take all possible steps to deem the value of the FMC debentures as nil to mitigate the financial strain on the investors. Attached is a copy of this letter.
Canyon Ridge Development
As noted in the September 7, 2012 update, one of the remaining FMC assets to be realized are the Canyon Ridge lots in Golden BC. To date, approximately 20 lots have been sold with the proceeds used to pay off the mortgage registered against the properties. There are 5 remaining unsold lots.
The Inspectors requested the Trustee apprise the investors of this opportunity to purchase any of the lots at the reduced prices (averaging approximately $50,000). Interested parties should contact the realtor, Mr. Bob Tegart of Re/Max Golden, at (250) 272-4321 or via email at firstname.lastname@example.org
Settlement with Individual Shareholders of HME Evans Co. Ltd.
FMC and PFK are creditors of HME Evans Co Ltd. (“HME”). PFK is also a 51% shareholder of HME. The balance of the shareholders of HME are individuals, the majority of which, we understand are related to the Peers/Evans family. The individual shareholders disputed the claims of PFK and FMC as creditors of HME.
After numerous Court applications and settlement discussions, PwC (in its capacity as Trustee of FMC and as agent for the secured creditors of PFK) entered into a settlement agreement with the individual shareholders. The settlement agreement was approved by the Inspectors of FMC on February 26, 2013 and subsequently by the secured creditors of PFK. Set out below is a background of the indebtedness and final settlement amounts.
FMC Mortgage Registered Against HME Evans Co. Ltd. FMC registered a mortgage against HME. HME’s financial statements reflected a balance owing to FMC totalled $527,507 as at December 31, 2009. The individual shareholders of HME challenged the validity and quantum of HME’s indebtedness to FMC.
A settlement of this indebtedness was agreed to with proceeds totalling $527,507 paid to the Trustee of FMC in final satisfaction of its claim against HME.
PFK Loans Receivable due from HME
As noted in the November 2011 update, it was anticipated that the estate of PFK would receive monies from the liquidation of HME. PFK claimed as an unsecured creditor of HME based on intercompany advances made to HME totaling $1.2 million. PFK is also a 51% shareholder of HME. The individual shareholders challenged the validity of the PFK intercompany advances to HME.
Due to the poor condition of the PFK books and records, PwC was unable to prove the $1.2 million in advances without the evidence of directors and officers of PFK. This situation left PwC with neither leverage to elicit a strong settlement or ability to prove the PFK debt in Court, as a result of which a settlement was entered into pursuant to which PFK received approximately $127,000, representing 10% of its original debt claim. Nevertheless, given that PFK was a 51% shareholder of HME, PFK has been able to recover as shareholder, half of the amount it was unable to recover as creditor, as described below.
PFK Shareholder Distribution from HME
As a result of the preceding settlement agreements, we anticipate a shareholder distribution of approximately $950,000 to be made by the Liquidator of HME to PFK once Court approval has been obtained later this year.
Federal Court Order Obtained by Canada Revenue Agency
On November 17, 2012, the Federal Court granted an order sought by Canada Revenue Agency (“CRA”) directing PwC to deliver to CRA certain books and records of PFK, FMC and HME pertaining to the HME Associates Program. Subject to subsequent negotiations between CRA and the Trustee regarding the sharing of costs, access to these records has been provided to CRA by PwC.
RCMP Seizure and Investigation
The Provincial Court of Alberta, upon being satisfied that there are reasonable grounds to believe that offences under Sections 380(1)(a) and 334(b) of the Criminal Code have been committed, granted a Search Warrant to the RCMP on January 3, 2013.
On January 7, 2013, the RCMP Integrated Market Enforcement Team served a Search Warrant on PwC for the seizure of all the books and records of PFK, FMC and HME. PwC is fully cooperating with the RCMP while it investigates PFK, FMC and HME.
Class Action Proceeding
Pursuant to an Order pronounced on May 15, 2013 and filed on June 12, 2013, the Plaintiffs in the Class Action proceedings against Jay Peers, Roberts Peers, Marc Peers, Danielle Peers, David Kauffman, Laleeni Sharma, Dawn Vader, David Lord, Gerald T. O’Neill and Mowbrey Gil LLP were directed by the Court to give notice to prospective class members of their intention to discontinue the class action proceedings. The Trustee is posting a copy of this Order and the corresponding notice in accordance with the Court’s direction.
Canyon Ridge Development
As noted in the July 20, 2012 update, one of the remaining assets to be realized are the Canyon Ridge lots in Golden BC. These lots were marketed for sale in late 2011 and early 2012 to developers, builders and individuals; however, no interest was expressed. The lots were subsequently listed with a realtor in April 2012 who priced the properties at or near their appraised value; however, there was also limited interest. We understand that the absorption rate for these lots will range between 3 to 5 years at the current listing prices given the current market in the interior of B.C. Accordingly, the Inspectors have authorized the Trustee to reduce the prices in order to sell the lots quickly and minimize the holding costs.
The Inspectors requested the Trustee apprise the investors of this opportunity to purchase any of the lots at the reduced prices. Interested parties should contact the realtor, Mr. Bob Tegart of Re/Max Golden, at (250) 272-4321 or via email at email@example.com.
|Lot#||Civic Address||Adjusted List Price|
|Single Family Lots|
|21||1505 Quartz Cres.||55,000|
|22||1509 Quartz Cres.||55,000|
|23||1513 Quartz Cres.||52,250|
|28||1533 Quartz Cres.||82,500|
|29||1537 Quartz Cres.||93,500|
|31||1545 Quartz Cres.||82,250|
|32||1549 Quartz Cres.||71,500|
|33||1553 Quartz Cres.||60,500|
|34||1557 Quartz Cres.||52,500|
|36||1565 Quartz Cres.||55,000|
|37||1569 Quartz Cres.||52,500|
|38||1573 Quartz Cres.||55,000|
|38||1573 Quartz Cres.||55,000|
|39||1577 Quartz Cres.||55,000|
|40||1581 Quartz Cres.||60,500|
|41||1580 Quartz Cres.||55,000|
|42||1572 Quartz Cres.||52,250|
|43||1568 Quartz Cres.||49,500|
|50||1512 Quartz Cres.||52,250|
|51||1508 Quartz Cres.||52,250|
|52||1504 Quartz Cres.||55,000|
|61||1394 Pine Drive||60,500|
|62||1396 Pine Drive||60,500|
|63||1398 Pine Drive||60,500|
|64||1400 Pine Drive||60,500|
|Multi Family Lot|
|54||1512 Granite Drive||154,000|
Alberta Securities Comission (ASC) Investigation
News Release from the Alberta Securities Commission
CALGARY - July 20, 2012 - The Alberta Securities Commission (ASC) has charged Edmonton businessman Jeremy (Jay) Peers in the Provincial Court of Alberta with 33 counts of breaching Alberta's securities laws. The ASC has also charged Jay Peers' son, Robert Peers, with one count of contravening the Securities Act (Alberta).
The charges relate to trading in Federal Mortgage Corporation Ltd. and Peers Foster Kristiansen Inc. securities during 2006 to 2010. In the Information filed by the ASC in the Provincial Court of Alberta, ASC staff allege that Jay Peers participated or engaged in a fraud on investors by using investor funds to pay returns to earlier investors and to make transfers to related parties. ASC staff also allege that Jay Peers sold Federal Mortgage Corporation securities without registering as a dealer or advisor with the ASC and that Federal Mortgage Corporation had not filed a prospectus. The ASC further alleges that Jay Peers misrepresented the degree to which Federal Mortgage Corporation and Peers Foster Kristiansen were safe and reliable investments and that he failed to disclose to investors the financial difficulties of both corporations.
ASC staff allege that Robert Peers participated or engaged in a fraud on investors by his involvement in the transfer of investor funds to related parties without loan or investment documentation.
The Information related to this case can be obtained from the Provincial Court of Alberta. A first appearance in this case has been scheduled for 8 a.m. on August 30, 2012 at the Edmonton Provincial Court of Alberta.
The ASC is the regulatory agency responsible for administering the province's securities laws. It is entrusted to foster a fair and efficient capital market in Alberta and to protect investors. As a member of the Canadian Securities Administrators, the ASC works to improve, coordinate and harmonize the regulation of Canada's capital markets.
For further information please contact:
For Media Inquiries: Mark Dickey Senior Communications Advisor
For Investor Inquiries: ASC Public Inquiries
Toll Free 1.877.355.4488
Registered Investments ( RESP, RRSP & RRIF)
Over the past year and a half we have received numerous telephone calls from investors about deemed distributions of funds held RRIF accounts and we have discussed the issues surrounding registered accounts with those investors.
We understand the issues being encountered with either Olympia Trust or Canadian Western Trust stem from the fact that investments made through registered plans (RESP, RRSP, RRIF) have very specific rules and regulations that must be applied as the investors have already received tax deductions for these investments. Upon enquiry, the trust companies have advised us that it is only after the Trustee has provided them with the final dividend sheet that they are able to conclude what value the company may have and then close the accounts as appropriate. The administration of these investments is outside the bankruptcy and, therefore, the Trustee has no ability to affect these accounts. We would suggest that you continue to discuss the appropriateness of Management Fees and other charges directly with the trust companies. The Trustee has no capacity to impact these arrangements otherwise.
In respect of concluding the bankruptcy, the Trustee cannot complete its final dividend distribution and apply for its discharge until all matters pertaining to the bankruptcy are completed. This includes the sale of all assets of PFK and FMC and ensuring any funds remaining in the estate are distributed by way of dividends to the creditors and/or investors. The largest asset remaining for the Trustee has to liquidate are the Canyon Ridge lots in Golden BC. These are proving to be difficult to sell in the current economy and we are working with the Inspectors of the estates to determine the most appropriate manner to realize on these assets in the shortest amount of time. In addition, the investigations by the ASC and the RCMP will have to be completed prior to the Trustee obtaining its discharge. The Trustee has no control over the timing of these investigations.
Mike Boyd has resigned as an inspector due to personal reasons, primarily the significant time commitment required.
As at October 31, 2011, the Trustee has sold most of the properties which were encumbered by various banks ahead of FMC and PFK thereby reducing the amount of any residual claims from those secured creditors against the estate. Due to market conditions and the condition of the properties, the estate will see minimal realizations from these sales as most of the proceeds went to pay the secured creditors who were in priority to PFK or FMC.
The Calgary duplexes had significant structural and maintenance issues that were estimated to cost in excess of $150,000 to rectify. Most potential purchasers viewed the duplexes as a high risk investment and therefore were unwilling to submit an offer. After more than 6 months on the market and few bona fide offers, the estate accepted an offer of $1,050,000 for the two duplex. The proceeds of the duplexes will not be sufficient to cover the secured claim by HSBC who will now make a claim against the remaining assets of the estate of approximately $60,000 under their security. In addition, FMC had a mortgage in excess of $1.7 Million against these duplexes which will not be satisfied.
The Springbank warehouse had significant structural issues that were estimated to require more than $900,000 to rectify and had carrying costs of approximately $17,000 per month. Additionally, the market demand for this type of building was weak and therefore in the 6 months the warehouse was on the market, only two offers were received. Therefore, the Trustee sought court approval for the sale of this asset. The offer to purchase of $2,500,000 was significantly less than the outstanding mortgages held by ATB ($2.3 million) and FMC ($7.1 Million). The court approved the acceptance of the offer and the sale is scheduled to close at the end of November. A copy of the court order is attached.
The Parkdale lot and the Riverview Place home were both sold for amounts greater than their encumbrances, and therefore the estate realized approximately $225,000 proceeds on these assets.
The estate of PFK will receive monies from the liquidation of HME Evans Co. Ltd. Both of the properties held by HME Evans have been sold although the amount of the distribution available to PFK is not known at this time. The court appointed a third party to validate the claims against the assets of HME Evans and once the liquidator has been provided with the findings from the accounting firm, the liquidator will file for court approval to make the distributions. The Trustee anticipates funds of approximately $1,200,000 to $2,000,000 from the sale of these assets.
The Trustee continues to collect on other outstanding loans and mortgages receivable where assets or other collateral is registered although many of these loans have now been fully paid out by the borrowers. The trustee will continue to collect on these loans and where appropriate, will commence legal action against those borrowers who have not made payment arrangements with the Trustee. The gross amount of these loans is $ 6.6 Million although a significant proportion of these loans are unsecured or has questionable collectability. These are being assessed on an individual basis to determine appropriate action to be taken on each of these loans.
The Trustee was advised by its tax advisors, that the CRA will not issue a ruling on a question of fact or on a transaction that has already occurred. Therefore, the determination as to whether each investor’s investment in PFK/FMC is available for an allowable business investment loss is eligible will have to be determined by the CRA on a case by case basis as filed by investors with their annual tax returns. Each Investor should submit a claim for losses on their tax returns after discussing the details with their tax advisor.
Canyon Ridge Development
PFK was a joint venture partner in a residential property development located in Golden BC. These lands were held by the joint venture, although PFK had obtained a mortgage on the property from Federal Mortgage Corporation who in turn obtained a mortgage from Canadian Western Bank. The Trustee entered into an agreement where the joint venture partner paid approximately $350,000 of outstanding property taxes on the development and the estate received certain properties in exchange for its interest in the joint venture. Subsequently, the Trustee obtained refinancing of the properties in the Canyon Ridge development so as to pay out Canadian Western Bank which had commenced foreclosure proceedings. The Trustee may now market the properties held by the estate free and clear of any third party encumbrances. The Trustee is currently developing a marketing plan for these properties held in the estate. This marketing plan will include selling the properties as a block to interested developers as well as making individual lots available to interested parties.
At this time, sales of the lots will be open to PFK or FMC investors only. Any investor interested in purchasing one of the lots listed below should contact us by January 15, 2012 for more information.
|Single Family Lots|
|21||1505 Quartz Cres.||39||1577 Quartz Cres.|
|22||1509 Quartz Cres.||40||1581 Quartz Cres.|
|23||1513 Quartz Cres.||41||1580 Quartz Cres.|
|28||1533 Quartz Cres.||42||1572 Quartz Cres.|
|29||1537 Quartz Cres.||43||1568 Quartz Cres.|
|31||1545 Quartz Cres.||50||1512 Quartz Cres.|
|32||1549 Quartz Cres.||51||1508 Quartz Cres.|
|33||1553 Quartz Cres.||52||1504 Quartz Cres.|
|34||1557 Quartz Cres.||61||1394 Pine Drive|
|36||1565 Quartz Cres.||62||1396 Pine Drive|
|37||1569 Quartz Cres.||63||1398 Pine Drive|
|38||1573 Quartz Cres.||64||1400 Pine Drive|
|Multi Family Lot|
|54||1512 Granite Drive|
The trustee continues to dispose of the assets of the company as efficiently as possible. Unfortunately most of the properties are significantly encumbered with multiple mortgages or other security interests and therefore, the sale of any of these assets is very complicated and cumbersome. Claims of the various parties with registrations against the assets must be individually validated prior to the trustee being able to finalize sales and for any funds to come into the estate.
Many of the smaller, less entangled assets have been sold, although realizations for the estate have been minimal. Many of the remaining assets are in poor condition requiring significant repairs and market conditions for the sale of these assets are generally unfavourable at this time.
The non real estate assets of the company are largely unsecured loans to related companies and individuals. The trustee is continuing to investigate and realize on these loans and receivables although it appears that there are very few of these loans that are backed by registered mortgages or tangible assets. In the short term, it is unlikely the estate will see any material funds from these assets.
There is a class action lawsuit being undertaken against the Peers and various Directors of the companies. The lawyer heading the class action is Mr. Louis Belzil of Rackel Belzil LLP. This lawsuit is separate from the work of the trustee. It is the trustee’s understanding that Mr. Belzil has sent a letter to all investors and creditors of the companies inquiring about their interest to participate in a class action.
The Alberta Securities Commission (ASC) is continuing its investigation into the operation of these two companies. The status or findings of this investigation is not known to the trustee.
On January 31, 2011, the Trustee mailed to all known shareholders of Peers Foster Kristiensen Inc. ("PFK"), at the addresses of record based on the books and records of PFK, a letter updating shareholders as to the status of the file and administration of the estate. This was done in an effort to provide information to non-creditors and reduce the administration of handling large numbers of inquiries from shareholders. A copy of the letter sent to shareholders is attached below.
In addition, as outlined in our update of February 11, 2011, on February 28, 2011, the Trustee mailed T5's, which were prepared by PFK's accountant, to investors which were paid interest in 2010 by Federal Mortgage Corporation Ltd. or PFK. Should there be any questions or concerns regarding the T5's received, please contact Ian Cameron of the Trustee's office at firstname.lastname@example.org.
Further to the Third Inspectors Meeting, it was confirmed that two inspectors, Charlie Cappello and Lori Griffith, have resigned as inspectors due to personal reasons, primarily the significant time commitment required.
The inspectors are now administering the estates as a combined estate pursuant to the March 2, 2011 Consolidation Order. The remaining inspectors are:
Since the First Meeting of Creditors on January 12, 2011, the Trustee has been investigating the affairs in the estates of PFK and FMC. In general, the operations and assets of PFK and FMC are closely connected, convoluted and involve many complex legal arrangements such as re-mortgaging of properties, mortgages on mortgages and intercompany transactions. In many cases, multiple parties are involved and positions have to be assessed before any determination of recovery can be made. This process has been very time consuming both from a legal and financial review perspective and has produced very few recoveries to date.
Also, the Trustee has conducted a cursory forensic review with the approval of the Inspectors. As a result of the review, the Trustee has obtained a Court Order to obtain electronic information from the estates’ service provider, Sentai Software Inc. A copy of the Court Order, along with the Second Report of the Trustee has been posted to the website. Further forensic procedures are required; however, the decision to pursue this will be brought forth to the Inspectors for discussion.
Further, as indicated in the Trustee’s Preliminary Report, the vast majority of funds were used to fund Titanwall group of companies and Metaform Ventures Corp. Although steps are being taken by the Trustee for the collection of these loans, based on a preliminary investigation, we cannot be optimistic that there will be any recoveries without incurring significant expenses.
Of necessity, certain information regarding the investigation of the estates has been kept confidential as disclosure of such information may be potentially prejudicial to the outcomes. Where possible, the Trustee will post updates as it continues to focus its efforts on pursuing recoveries; however, at this juncture, prospects of any recovery are slim.
With the approval of the Inspectors, the Trustee has obtained an order to consolidate the estates of PFK and FMC as a means to reduce administrative costs. A copy of the Consolidation Order can also be found on the website.
We sincerely appreciate the predicament of many of the investors and we will continue to pursue all possible recoveries in as cost effective a manner as possible.
T5 slips will be issued in respect of interest paid by PFK or FMC during 2010. T5 slips will not be issued in respect of interest obligations due, but not paid. PwC is not in a position to confirm whether obligations due will be paid or whether such amounts were added and capitalized to the investment account.
Century Services Inc., on behalf of the Trustee, will be holding an auction of the office equipment of PFK at the office of PFK, located at 11207-103 Avenue, on Wednesday February 2, 2011 starting with a preview between 4:00 and 6:00 PM with the auction commencing at 6:00 PM.
On December 9, 2010, Peers Foster Kristiansen Inc. (“PFK”) and Federal Mortgage Corporation Ltd. (“FMC”) filed assignments into Bankruptcy and PricewaterhouseCoopers Inc. was appointed as Trustee of the estate of the bankrupts.
All parties who are owed money as of the date of the bankruptcy may have a claim in the estates of PFK or FMC.
The first meeting of creditors of the bankrupts will be held on Wednesday January 12, 2011 at a location to be determined shortly. Notice of the bankruptcies will be sent to all known creditors of the estate providing the date, time and location for the first meeting of creditors. Notice of the meeting will also be advertised in the Edmonton Journal. In addition, this website will be updated with all current information.
At the meeting, the Trustee will provide information on PFK and FMC’s financial affairs, the causes of its bankruptcy and certain other matters.
This Web site will be updated as information becomes available.
For more information, please contact: PricewaterhouseCoopers Inc., Telephone: +1 780 441 6738, Fax: +1 780 441 6776, Email.
This page is for information purposes only and you should consult your professional adviser.
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