Onus – How we need to change our perspective on White Collar Crime.

May 9th, 2017 · 1 Comment · Educational Resources

It’s on us to change the onus on white collar crime. People who have not had anything to do with these kinds of fraud have no idea the damage these scams and schemes cause. Ever since Exempt Securities were allowed into the average person’s RRSP, RESP and retirement savings, it has been a shit show of corruption, regulation arbitrage, and preying on the unsophisticated investor.

Recently there was a clear example of what can happen when an onus is reversed. Bear with me, it is a real estate blog after all.

Landlord & Tenant Board – Owner’s Own Use Form

For many years, owners would give the owners own use form to evict tenants. The a month of two down the line, maybe some renovations, the place would get rented for more money. Nobody really did anything about it. The onus was on the tenant to prove bad faith. But how to prove bad faith? Mind reading is hard. Tenants would go to the Landlord & Tenant Board with a copy of the ad for more money and lose because they couldn’t prove what was in the owner’s mind.

Recently with the new rental act this has changed. It is now clear in the legislation, that if a tenant finds another ad for more money, the owner acted in Bad Faith. It then becomes the job of the owner to prove they did not act in Bad Faith.

Bankruptcy, Lost Money, Funky Accounting – It’s On You

If you are a part of the executive that takes money from investors, the onus should be on you to explain where that money went. You can’t just disappear millions of dollars. This actually happens frequently. Money just disappears in the millions. How the hell does that happen? Nobody noticed? Where did it go?

I’m not joking when I say that if millions of $$$ of investor money just plain goes missing, people should be in jail until they remember. I’ll bet that would shake some memories loose.

Even when the company goes into CCAA or bankruptcy, no bothers to track the money down and that’s really disturbing. I’m not talking a rounding error here, I’m talking about millions stolen from investors by companies who have a fiduciary responsibility to respect investor funds.

We Should Reverse the Onus

If you declare bankruptcy or CCAA, it should be your responsibility to be able to show where investor dollar was used and that you used if in good faith to try to make a profit. If it is just gone or missing the executive of that company should have to explain why it isn’t fraud. Rather than the other way around. Oh I dropped a couple million $ and I don’t know where it went.  Bullshit ! that money went somewhere. Probably right in your pocket, you jerk. Maybe call the dog catcher, they find missing pets, maybe they could find missing money?

It’s unacceptable, we can do better. Let’s stop allowing fraud and bad behavior. We need to hold people accountable for their bad behavior instead of rewarding unjust enrichment.

Due Diligence & Fraud Apologists

You cannot blame the investor for everything, whenever money goes missing, and you should know better. In the past we used to blame rape victims for being slutty and wearing the wrong clothes. Criminals in suits are laying elaborate, sophisticated traps for average unsophisticated investors. Grandma deserves protection people! The less sophisticated the investor targeted by the company marketing, the less due diligence that investor should require. This is why soaps for kids are practically edible. If you’re targeting institutional investors with your hedge fund, no one cares because they can and will ask for financial accountability. Grandma, even if she asked to see your financial statements, might not be able to read it and interpret the results. That’s why the onus should be on the person taking the money to answer questions when money goes missing.

When I was a cashier, a $20 bill rolled into the back of the cash tray, and my cash was short. I almost got fired and the $20 was found the next day. I was responsible for that money. Same deal with Joe entrepreneur taking money from the public for investment. Companies do fail, and errors in judgement are made, but millions of $ do not just disappear like a bad magic trick.

These criminal guys specialize in looking great, clean, fancy, reputable and promise a lot more then their honest counterparts. That’s because they spend on all their energy on their appearance and they promise the world, chances are they can’t deliver and aren’t planning to deliver.

The Hilarity of Know Your Client Forms

No one is checking these, except the people who work for the company profiting from the sale of the investment. I had this unbelievable conversation with a BSCS or OSC investigator in the murky past where I just kept saying “Who checks that the forms are filled out properly and that the company is being honest about it? ”  No one does.  As long as the boxes are checked, good enough. I understand I’m cynical but I want the rules put in place to be checked by someone who can do something when they are not followed.

Anyone Standing Next to Thieves Should Feel The Heat

Mr. Accountant audited said scammers’ books. You, Mr Lawyer assured investors everything was great with Scamsters Inc. These professionals that play a very large part in allaying investor’s who are doing their due diligence fears, need to know that if they vouch for Scammers, they too will pay. If you aid and abet a fraud to look like a legitimate going concern, you too should have some serious questions about what you should have known.

And for crying out loud professional people please just wash your hands of these bad business people. It’s not worth the fees to know that your brand is sullied by standing next to these characters.

Scams Not Even Once.

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One Comment so far ↓

  • Linda

    Isn’t this the case of the fox guarding the henhouse? I don’t see any reforms coming since it isn’t in the foxes’ best interest.