ICYMI: $75M lawsuit against Guelph developer cleared to move forward
A $75 million lawsuit against Guelph developer Scott Reid, accused of operating a Ponzi scheme, is proceeding after a stay of proceedings was lifted.Summary
A civil lawsuit seeking $75 million in damages from Guelph developer Scott Reid and his affiliates is moving forward after a judge lifted a stay of proceedings under the Bankruptcy and Insolvency Act. Investors accuse Reid and his company, Reid’s Heritage Properties (RHP), of operating a Ponzi scheme following the company’s bankruptcy and the revelation of approximately $75 million in losses for nearly 200 investors.
Justice S. Kettle determined lifting the stay was necessary to prevent further prejudice to the plaintiffs, noting bankruptcy discharge doesn’t absolve debt arising from fraud. While initial asset freezes (Mareva orders) were in place for Reid’s wife, Shelley, and were partially lifted, a new, broader Mareva order now restrains Reid from dealing with any assets and requires full financial disclosure.
The court has allocated funds from the sale of the Reid’s home towards legal fees and Shelley Reid’s expenses. Scott Reid is scheduled for cross-examination to trace funds and determine if any assets were transferred in violation of the injunction. Trustees BDO and Deloitte will also provide financial records to the plaintiffs.
(Source：Google News)