DID ALBERTA SECURITIES COMMISSION ALLOW WALTON INTERNATIONAL A FREE PASS?

-POSTED PREVIOUSLY-

What a last couple of weeks it has been for Walton International – the Alberta Securities Commission suspended Walton’s registration which prohibits them from selling any more of their investments.  And then they hired Ernst & Young to take them through the CCAA process in an attempt to re-organize their debt.   This sounds almost identical as the League Assets story we discussed last summer in this blog post.     One can conclude the Walton matter will have the same ending!   How can a company make hundreds of millions of dollars selling land be broke after 25+ years of being in business?  Rumor on the street is the company is being gutted and those (at the top) have already cashed out their millions…

WAS THIS ALL PREDICTABLE?

Back a few years ago I came across a Sales Representative that worked at Walton International at a Calgary Flames hockey game.  After chatting for a few minutes he suggested I look at his investment opportunity – it was a parcel of land down by Spruce Meadows (in the southern tip of Calgary).    Although I was not interested in the investment, I agreed to meet with him at his office a short while later.

I remember their office being really nice and it seemed like they had a ton of staff.  After receiving a brief sales pitch I was sent on my way with an envelope full of paperwork.   Some time later, I opened the envelope and (as part of the package) discovered a letter from a lawyer named Donald Boykiw from the fancy Bennett Jones LLP law firm.

The letter is short and cuts to the point – it indicates that Boykiw is writing to inform Walton that the Alberta Securities Commission had reviewed Walton’s business practice of selling undivided interest in land to purchasers and that this review had been done as a result of sanctions against Walton’s prime competition in Alberta land banking.    Boykiw goes on to state, “I would also advise that the Commission staff member who was involved in this matter has further advised that the ASC’s enforcement counsel would not be recommending any changes to the current forms of referral arrangements for both the mortgage referrals from Westmount Mortgage Corporation and the land referrals from Cordex Realty.   We have also received a follow-up call from the registration counsel at the Alberta Securities Commission indicating that they ave also completed their review of such referral agreements and were not proposing any changes.”    A copy of the letter:  

The significance of this letter is simple – Walton International’s business model sees them allegedly buying farm land for as little as $400 per acre and turn around only days later and sell it for up to 7000% increases to investors from all over the World – and the gang down at the ASC gave them a clean bill of health while sanctioning others in the same line of work.    And don’t forget – this happened during Ralph Klein’s duration as Premier of Alberta who’s daughter physically worked at Walton’s head office.

For those people that do not know who Walton International are (or were) – they purported to be the largest land banker (and then later land developer) in the nation.    They had many projects throughout Canada and the United States.   They had come under fire in some circles for paying huge upfront commission to their sales people and for having lavish spending sprees on chartered boats and trips for Staff.   In one instance, it was reported they had chartered a large ship and had the expensive Self-Help Guru Anthony Robbins as a guest to get their staff motivated to sell their product.

Facts are – may people have been reporting on Walton’s demise for years.   A simple google search has found us endless reports from press from all over the World suggesting Walton’s business plan had some distinct cracks and was leaking severally.   An article in the Ottawa Citizen from March 2013 suggests the land banking project in Ottawa was in trouble.

What happened in Singapore when they had several complaints about many Land Banking firms – even Walton International?   Out comes the huge Public Relations wheel and they brought an entire news crew to see their operations in Canada….

This video is so biased towards Walton but comes across as some bi-partial news telecast – We wonder how much more they raised after this video made the rounds…

Would this all have been avoided IF the ASC had not given them that clean bill of health back in 2002 – that they used as a sales aid for their sales people???  Shame on the ASC!   This story is going to be huge when the cards ALL come falling down – and this letter is going to be used in any case against the ASC!   How are they going to be able to protect the Walton Investors when they are complicit in allowing Walton to exist – even going as far as giving legal advice that their sales people used to close the unexpected investors?

 

2 thoughts on “DID ALBERTA SECURITIES COMMISSION ALLOW WALTON INTERNATIONAL A FREE PASS?”

  1. I’m a Walton’s investor that bought into Walton’s in December 2007 for property in the US, Pichacho View which is located in Eloy Arizona. Fanny Fay issue in the states hit in 2008 which saw this investment stalemated for years.. In 2015 everything seem to be back on track with forward vision, Phoenix Mart highways etc etc. It appeared exit was imminent. May 2017 Waltons announces bankruptcy in Canada. I ask and they (Walton) state no affect to my investment in the States. That was a Lie, restructuring of all Walton’s land resulted in re-valuations of all the projects some were dollar for dollar of RUC shares, mine in particular where only valued at 20cents on the dollar.. fast forward out of bankruptcy their website appears to be dormant, no new exit information etc etc.. Their business plan was to build vertically and horizontally with dividend payouts yearly if not twice yearly. Doherty and clan of Directors have 100,000 shares each in the new company. There are 71 million shares out there with 710 million in assets..(Land) For me to re-coop my investment dividend checks in the amount of 10.00 a share per year for 10 years would have to be issued by Walton’s.. Something stinks here, this company I bought into because it was a Canadian based family company with Bill DOHERTY as the owner, their prospectus was 14 percent annual return on investment with 4-6 year turn time.. I’ve yet to receive anything and feel my investment is gone.. This company I feel has defrauded investors and should be looked at by the Alberta Securities Commission for Fraud.. Investors need to be paid back in some form….

    1. Neil, let me first say I am very sorry you feel your investment is gone. This is never an easy scenario for anyone to go through. I am not sure what Walton paid for any of their land holdings in the USA but in Canada it was very much public record for a long time. I have friends in Asia (whom invested in Walton) that to this day still reach out to me and ask if I can help them ascertain what has happened to their investment dollars. Its a tough one – like I said in my post, Walton was trying back in the mid 2000’s to unload mortgages they had on their own properties. This to me was a major red flag – why would they be selling the paper of their own investments/holdings? It doesn’t make sense! It is some peoples opinion that Walton was a huge PONZI SCHEME that many people knew about – in that they had to bring in “new” investors to pay out the old. This was rumoured for a long time, specifically back in the late 90’s and early 2000’s as they did not have a lot of projects mature in the time frames they agressively offered.

      The Alberta Securities Commission (in my opinion) won’t do anything to Walton. Like the BCSC, the ASC appears to be a “racket” and they would probably have to admit wrongdoing if they went after Walton. My reason for concluding this is that they appeared to give Walton a green light on many of their offerings – and as the letter in my blog indicates – they gave them a clean bill of health whcih their staff used as a marketing tool. The regulators are NOT allowed to give this blessing to any company – specifically if it is to be used to market their shitty land deals.

      Neil, I wish things were different for you. But I do not see this ending well for the little guys – the big guys have already had their snouts in the trough for far too long.

      RW

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