Hamilton police arrested the head of failed firm this week. A few more details emerge.
News broke this week that Hamilton Police arrested Scott Reeves of Reeves Financial Services Inc. on four fraud charges related to missing client funds. A quick online conversation with the Hamilton Spectator reporter following the story, Stephen Arnold, sheds a little more light on the story.
According to Arnold, Reeves had something of a public profile in Hamilton. He was the co-author of a book about financial planning for gay couples that had garnered some local attention. The company had also expanded over the years to the point Reeves Financial had, at its peak, four offices in Hamilton, Burlington, Kitchener and Toronto.
But as the Great Recession of 2008 settled in, things began to fall apart. The chain contracted to one main location in the downtown core of Hamilton. The landlord eventually demanded payment of $180,000 in missed rent. A Hamilton Spectator article quotes John Blanchard of Wilson and Blanchard Property Management, as saying the company "pulled a midnight move on us and vanished."
A formal declaration of bankruptcy followed in June. According to the docs there was almost $418,000 in debts, but only $27,000 in assets. At the time, the principal of the firm, Scott Reeves, claimed $85,000 for advances made to the firm (Reeves did not claim personal bankruptcy, only the firm did). Other debts on the list include $32,000 owed to the federal tax department, $10,000 to a Hamilton law firm and $55,300 to former senior vice-president Paul Carvalho. Regulated by the Financial Services Commission of Ontario (FSCO) and by the OSC, Reeves Financial had a license to sell mutual funds for a company called Fundex Investments Inc. That license lapsed in May.
"I've had a few calls from people asking if their money is safe but I've haven't been overwhelmed by them. I think that since his firm went bankrupt many clients knew right away their money was gone," says Arnold.
Reeves also did a bit of business as a mortgage broker. A Hamilton Spectator story quotes Joseph Trombetta, principal broker for Stoney Creek-based Verico Titan Mortgage Solutions, was quoted in one of Arnold’s articles as saying he only did "three or four deals last year" with Reeves. "I'm mesmerized by this," Trombetta said to the Spec. "If you're advising people on how to create worth, the absolute worst thing you can do is go broke yourself."
This is extremely solid advice.
Police arrested Reeves this week. A complaint came into the police in June from a client who found over $300,000 in GIC money was missing. Police believe losses will be substantially more than what is known about. A police press release suggests there have been other complaints and that losses are going to be “in the millions rather than hundreds of thousands."
According to Arnold, Reeves had something of a public profile in Hamilton. He was the co-author of a book about financial planning for gay couples that had garnered some local attention. The company had also expanded over the years to the point Reeves Financial had, at its peak, four offices in Hamilton, Burlington, Kitchener and Toronto.
But as the Great Recession of 2008 settled in, things began to fall apart. The chain contracted to one main location in the downtown core of Hamilton. The landlord eventually demanded payment of $180,000 in missed rent. A Hamilton Spectator article quotes John Blanchard of Wilson and Blanchard Property Management, as saying the company "pulled a midnight move on us and vanished."
A formal declaration of bankruptcy followed in June. According to the docs there was almost $418,000 in debts, but only $27,000 in assets. At the time, the principal of the firm, Scott Reeves, claimed $85,000 for advances made to the firm (Reeves did not claim personal bankruptcy, only the firm did). Other debts on the list include $32,000 owed to the federal tax department, $10,000 to a Hamilton law firm and $55,300 to former senior vice-president Paul Carvalho. Regulated by the Financial Services Commission of Ontario (FSCO) and by the OSC, Reeves Financial had a license to sell mutual funds for a company called Fundex Investments Inc. That license lapsed in May.
"I've had a few calls from people asking if their money is safe but I've haven't been overwhelmed by them. I think that since his firm went bankrupt many clients knew right away their money was gone," says Arnold.
Reeves also did a bit of business as a mortgage broker. A Hamilton Spectator story quotes Joseph Trombetta, principal broker for Stoney Creek-based Verico Titan Mortgage Solutions, was quoted in one of Arnold’s articles as saying he only did "three or four deals last year" with Reeves. "I'm mesmerized by this," Trombetta said to the Spec. "If you're advising people on how to create worth, the absolute worst thing you can do is go broke yourself."
This is extremely solid advice.
Police arrested Reeves this week. A complaint came into the police in June from a client who found over $300,000 in GIC money was missing. Police believe losses will be substantially more than what is known about. A police press release suggests there have been other complaints and that losses are going to be “in the millions rather than hundreds of thousands."
