Vancouver man defrauded investor out of most of $2 million mortgage, B.C. regulator alleges
VANCOUVER -- British Columbia's financial regulator is accusing a Vancouver man and a company run by his late father of defrauding an investor out of almost $2 million.
The British Columbia Securities Commission alleges that Geoffrey Rajay Sidhu advised a woman he met online to take out a mortgage on her home, which she owned outright, and invest most of the money in his father's company. Sidhu's father died in March 2021, according to a notice of hearing from the BCSC.
The commission says Sidhu helped the woman obtain a $2,070,000 mortgage against her home and recommended that she invest roughly $1.75 million of that total in Bracetek Industries Group Ltd.
According to a news release from the BCSC, the company told the investor that it "had licensed the exclusive right to develop, manufacture and sell proprietary braces used in residential and commercial construction."
Sidhu also allegedly told the woman that her investment would triple after his father took the company public, something Sidhu said would happen within a year, according to the BCSC.
Neither Sidhu nor the company disclosed important financial information to the investor, the commission alleges.
Among the information that allegedly went unshared was the fact that Bracetek "had $89.45 in its bank account and no revenues," owed more than $300,000 to various creditors, and "had never paid for the technologies used in its braces," according to the BCSC.
The commission alleges that the company used the investor's money for purposes other than the ones it said it would. The BCSC also alleges that the company, with Sidhu acting as an agent, distributed its shares to the investor without filing a prospectus - the formal document that describes the details of an investment.
The BCSC's allegations have not been proven. A hearing on the matter has been scheduled for Aug. 11.