A case that’s cost clients millions and first came to light last September was busted wide open last week with Hamilton Police laying a dozen new charges.
Former Hamilton dual-licensed advisor Scott Reeves was flying high prior to the 2008 financial crisis operating four different companies through a number of Toronto-area offices including its Steeltown headquarters.
Then it all went to south.
First, Reeves took $300,000 in client money and instead of investing those funds in low-risk credit union GICs, he used the money for his own purposes. The advisor was charged in September 2014 with two counts of uttering forged documents, one count of fraud over $5,000 and laundering the proceeds of crime.
Last week Hamilton Police laid 12 additional charges related to a number of different complainants who also thought they were investing in low-risk, high-yielding investments but instead Reeves allegedlhy used their funds for his own purposes.
Police estimate the losses from all involved totals $5 million. Unfortunately, Reeves didn’t put any money aside for a rainy day.
In June last year Reeves’ company, Reeves Financial, was forced into bankruptcy listing assets of just $27,000 and debts of $418,000 including $180,000 in back rent for its Hamilton headquarters as well as substantial sums to both Reeves himself and former senior vice-president Paul Carvalho.
While FSCO and MFDA are conducting their own reviews it’s unlikely that much can be done at this point to recover any of the funds through disciplinary sanctions as the former advisor let both his mutual fund and insurance licences lapse in May 2014.
Reeves’ explanation for the firm’s bankruptcy?
It tried to grow too quickly in a very competitive market; and its managers failed to keep a close eye on its business.
That might be true but it doesn’t explain how Reeves was able to blow $5 million with nothing to show for it.
See more: Filling in the details: Reeves Financial
Then it all went to south.
First, Reeves took $300,000 in client money and instead of investing those funds in low-risk credit union GICs, he used the money for his own purposes. The advisor was charged in September 2014 with two counts of uttering forged documents, one count of fraud over $5,000 and laundering the proceeds of crime.
Last week Hamilton Police laid 12 additional charges related to a number of different complainants who also thought they were investing in low-risk, high-yielding investments but instead Reeves allegedlhy used their funds for his own purposes.
Police estimate the losses from all involved totals $5 million. Unfortunately, Reeves didn’t put any money aside for a rainy day.
In June last year Reeves’ company, Reeves Financial, was forced into bankruptcy listing assets of just $27,000 and debts of $418,000 including $180,000 in back rent for its Hamilton headquarters as well as substantial sums to both Reeves himself and former senior vice-president Paul Carvalho.
While FSCO and MFDA are conducting their own reviews it’s unlikely that much can be done at this point to recover any of the funds through disciplinary sanctions as the former advisor let both his mutual fund and insurance licences lapse in May 2014.
Reeves’ explanation for the firm’s bankruptcy?
It tried to grow too quickly in a very competitive market; and its managers failed to keep a close eye on its business.
That might be true but it doesn’t explain how Reeves was able to blow $5 million with nothing to show for it.
See more: Filling in the details: Reeves Financial
