Vancouver businessman set up ‘sham foundations’ and shell companies to dodge $9.3m U.S. court judgment: claim

BIV's lawsuit of the week

Photo: Rob Kruyt

A Utah-registered limited liability company and a Colorado man are suing Frederick and Thomas Sharp and several companies they control, claiming the pair aided a business associate in avoiding a $9.3 million court judgment by using “sham foundations” and shell companies to transfer and dispose of assets.

Big Indian Ventures LLC and Mark A. Steen filed a notice of civil claim in BC Supreme Court on May 3, naming brothers Frederick and Thomas Sharp as defendants, along with Quarry Bay Capital Inc., Quarry Bay Equity Inc., Quarry Bay Investments Inc., Quarry Bay Capital LLC, City Group Alliance Inc. and Charterhouse Capital Inc.

“At all material times Frederick and Thomas Sharp were involved in the business of creating offshore companies to assist individuals and businesses with hiding money and avoiding paying debts and taxes,” the claim states.

The plaintiffs claim the Sharp brothers, through their many corporate entities, assisted non-party Richard Terrance Heard and his companies, Drillsteel Resources Ltd. and Mayan Minerals Ltd., to dispose of assets in an alleged attempt to dodge a $9.3 million court judgment handed down in Utah, which was later recognized by the BC Supreme Court in March 2018.

“Frederick Sharp and Thomas Sharp are business associates of Heard,” the claim states. “In particular, at all material times Frederick Sharp and Thomas Sharp participated in schemes designed to hide Heard’s and Mayan’s assets from the plaintiffs in order to defeat, delay, hinder, prejudice or defraud the plaintiffs of their just and lawful remedies against Heard and Mayan.”

Steen and Big Indian claim that Mayan Minerals disposed of three apartments in Vancouver’s Terminal City Club Tower between February and July 2016 for more than $3.2 million, with portions of the proceeds from the sales allegedly transferred to defendants Charterhouse and Quarry Bay Capital.

As part of the alleged conspiracy, the defendants “created, marketed, sold and serviced sham foundations and shell companies under the laws of jurisdictions outside of Canada or the United States for the purpose of obscuring beneficial ownership of assets held by Heard and Mayan to conceal from the plaintiffs.”

“Heard and Mayan transferred ownership of their assets, including among other things funds and contractual rights to diamond mining royalties, into the names of sham foundations and related shell companies, which had nominee officers and directors provided by Frederick and Thomas Sharp and the Sharp Entities, and Heard and Mayan continued to have complete access to the assets and complete control over the assets,” the claim states.

The plaintiffs seek damages for conspiracy and declarations that the asset transfers are void under the Fraudulent Conveyance Act. The allegations have not been tested or proven in court and none of the defendants had responded to the claim by press time.