A court-ordered investigation found that $211.9 million raised from investors by a Saskatoon-based real estate firm nearly disappeared.
Epic Alliance Real Estate Inc. controlled over 500 properties in Saskatoon and North Battleford.
The company collapsed earlier this year following a temporary cease trade order issued in October by Saskatchewan’s Financial and Consumer Affairs Authority (FCAA).
The company’s two founders, Rochelle Laflamme and Alisa Thompson, informed investors of the company’s demise during a 16-minute Zoom call on January 19.
“We just couldn’t go back on the no-trade order. The FCAA fucked us, so that’s it,” Laflamme said.
In February, dissatisfied with Laflamme and Thompson’s explanation, a group of 121 investors successfully requested that a court-ordered inspector examine the company.
The accounting firm Ernst and Young was appointed by a judge of the Court of Queen’s Bench to examine the books of the firm.
According to the inspector’s report submitted at the end of April, “only symbolic cash and other assets remained” following the disintegration of the company.
The investigation was hampered by the fact that Epic Alliance and a group of related companies failed to keep “accurate electronic accounting records” until 2019, according to the report.
Many files available to the investigator were “very disorganized” and computer servers containing the company’s financial data were found missing from the company’s offices, according to the report.
“The inspector identified an empty server rack where multiple servers containing EA Group’s network data should have been stored,” the report said.
“A drill was located on top of the server rack which appeared to have been used to remove the servers.”
Security cameras monitoring the room had been disabled or had their wires cut, according to the report.
Ernst and Young eventually found the servers — with some data still intact — at a computer company that was allegedly responsible for “cleaning up” and selling the servers, according to the report.
The inspector also discovered that Epic Alliance had raised $370,000 from four investors while the FCAA’s trading ban was still in effect.
During the period, a promotion was offered allowing new investors to earn an additional 2% above the posted interest rate.
The Saskatoon Police Department’s Economic Crimes Unit is also investigating a complaint against Epic Alliance filed by an Ontario investor, spokeswoman Alyson Edwards said.
CTV News was unable to reach Laflamme and Thompson for comment.