June 30, 2022

Former PI Monetary proprietor Gary Ng was charged in late January with one depend of fraud over $5,000 and one depend of laundering the proceeds of crime.Mikaela MacKenzie /Winnipeg Free Press

Gary Ng, the entrepreneur who took Canada’s asset administration business by storm with a extremely publicized acquisition spree that got here crashing down amid allegations of forgery, has been charged criminally by the RCMP.

Mr. Ng, the previous proprietor of PI Monetary Corp. and a former co-owner of Bridging Finance Inc., was charged in late January by the Mounties’ Built-in Market Enforcement Workforce (IMET), with one depend of fraud over $5,000 and one depend of laundering the proceeds of crime.

In an e-mailed assertion, Mr. Ng’s defence lawyer, Christi Hunter, stated Mr. Ng denies the prison allegations in opposition to him “and intends to completely defend himself by way of the prison course of.”

The RCMP’s costs weren’t made public on the time they have been laid, however in an e-mailed assertion, the Mounties confirmed they charged Mr. Ng on Jan. 31 and that he surrendered on Feb. 7. He was launched and his first courtroom look is about for March 25 in Toronto.

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Within the e-mailed assertion, the RCMP stated the fraud cost stems from its investigation into allegations that Mr. Ng secured loans utilizing falsified collateral, and the cash laundering cost stems from the makes use of of the loans that Mr. Ng obtained.

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The RCMP’s costs comply with two current high-profile investigations by Canadian regulators through which Mr. Ng performed central roles.

The primary of these, launched by the Funding Business Regulatory Group of Canada (IIROC), alleged Mr. Ng used fabricated funding account statements to inflate his private internet price and persuade lenders to supply him with $172-million in loans.

A big portion of that debt was used to finance Mr. Ng’s buy of a number of funding advisory corporations, probably the most vital of which was his 2018 acquisition of PI. Mr. Ng paid $100-million in an all-cash deal to amass the Vancouver-based supplier, which presents funding banking and wealth administration companies and had $4.5-billion in belongings underneath administration on the time.

PI is now underneath the management of Miami-based HIG Capital and Vancouver-based RCM Capital, two of the lenders that financed Mr. Ng’s buy primarily based on allegedly cast paperwork.

IIROC’s enforcement listening to in opposition to Mr. Ng is scheduled to be heard in Vancouver from Could 9 to Could 20. He has not appeared at any of the regulator’s earlier hearings, both in individual or by way of a authorized consultant.

The regulator additionally alleges Mr. Ng provided falsified collateral when shopping for a 50-per-cent stake in personal debt supervisor Bridging Finance in the summertime of 2019, and his buy landed Bridging in sizzling water with a special regulator, the Ontario Securities Fee.

Across the time of this $50-million buy – which offered a non-controlling curiosity in Bridging – Mr. Ng likened himself in media interviews to an “admiral” amassing a “fleet” of monetary corporations. Though Bridging is alleged to have been a sufferer of the fabricated account statements on the coronary heart of IIROC’S case, Bridging additionally lent Mr. Ng’s firms greater than $131-million. These loans are actually a part of a broader investigation into Bridging by the OSC.

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Bridging was positioned underneath the management of a court-appointed receiver in April, 2021, and the OSC has cited Bridging’s loans to Mr. Ng as a part of an alleged sample of self-dealing by some Bridging officers and executives.

In courtroom filings, the OSC faulted Bridging for not disclosing to its 26,000 buyers that it was lending to Mr. Ng on the similar it was “engaged in discussions for Ng to amass a major curiosity” in Bridging itself.

For its half, Bridging has identified that, when the allegations of falsified collateral got here to gentle in early 2020, Bridging’s house owners – Jenny Coco and Natasha Sharpe – personally began repaying Bridging buyers for the unhealthy loans as a part of a deal to purchase again Mr. Ng’s $50-million stake in Bridging for $5.

In its most up-to-date report back to the courtroom, PricewaterhouseCoopers LLP, the receiver that now controls Bridging, additionally highlighted Bridging’s lack of disclosure to buyers with respect to a special side of its relationship with Mr. Ng.

PwC alleges in its report that in July, 2020, Bridging entered right into a settlement settlement that offered Mr. Ng with a covenant to not sue him. PwC says this covenant might hinder investor restoration efforts and that the “quantities owing underneath the Ng loans could also be rendered uncollectible.”

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