About 1,200 investors who entrusted their savings to Victoria mortgage broker Greg Martel will get a better sense of their chances of recovering money on July 26, when PricewaterhouseCoopers is set to run a first meeting of creditors.
The meeting will provide creditors an update on the receivership and bankruptcy of Martel’s My Mortgage Auction Corp. Inspectors will be elected from among the creditors to advise the receiver on how to proceed, and creditors will vote on next steps in the proceedings.
Creditors who have already filed a proof of claim with PricewaterhouseCoopers will be eligible to vote at the meeting.
The inspectors elected will represent the larger creditor group and will be made up of investors, former employees and trade creditors who all have claims against My Mortgage Auction. Their job will be to advise the trustee on next steps, including when to engage legal counsel or begin litigation.
The trustee already has a list of about 1,200 investors who are out at least $226 million after entrusting their savings to Martel. So far they have been told very little money has been found through the first few months of the receiver’s inquiries.
The receiver’s most recent report makes it clear Martel has been evasive when it comes to answering direct questions about where the money was invested and has not co-operated fully with the receiver’s investigation.
The receiver has been digging to find out what happened to the $226 million investors sank into Martel’s company My Mortgage Auction Corp. to fund short-term bridge loans for commercial and residential real estate deals. The money was to be repaid with high interest.
Many of the investors claim they have been waiting months for repayment.
Bankruptcy proceedings allow the trustee to review payments My Mortgage has already made to some investors and claw that money back for the estate.
But the initial investigation suggests there will not be much money to spread out among the creditors.
The most recent statement of property shows the trustee now has control of just $292,586, between funds that are being held by the court and cash on hand already recovered.
Filed documents suggest My Mortgage has no real estate, no bills of exchange or promissory notes and no one owes it any money.
The money the trustee does have is already spoken for. PricewaterhouseCoopers is owed $300,000 for its services so far, while Royal Bank and My Mortgage employees, both considered secured creditors, are claiming $20,200 and $40,000 respectively.
PricewaterhouseCoopers is continuing to investigate Martel’s financial dealings along with his companies Shop Your Own Corp., Martel Investments, 2289548 Alberta Ltd., Shair Your Car, Snail Team One, Snail Team Six, G&G Discount Merchandise and Martel Capital.
It has moved to freeze any bank accounts and assets Martel may have.
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