B.C. man who defrauded investors out of millions will not have to preserve retirement accounts, court rules
A man who owes the B.C. Securities Commission more than $36 million will not have to preserve his retirement accounts in order to pay his debts, according to a ruling from B.C.'s highest court.
The B.C. Court of Appeal revoked a preservation order imposed by the commission against Earle Douglas Pasquill that would have prevented him from withdrawing or transferring funds from two "life income fund" accounts.
The purpose of the order was to keep those funds in the accounts, so that they could potentially be used to repay some of Pasquill's victims.
Pasquill owes the BCSC an administrative penalty of $15 million stemming from a panel decision in 2014 that found he and an associate, Michael Patrick Lathigee, had fraudulently raised $21.7 million from 700 investors back in 2008.
Pasquill is also liable for the $21.7 million, and the BCSC says in a news release that he "has not paid any portion of those sanctions, and has not presented a plan for paying them."
The LIF accounts that the commission sought to preserve were worth $644,951 as of April 2020, according to the BCSC.
The commission sought the preservation order under B.C.'s Securities Act, which was amended in 2020 to allow it to make such orders on registered accounts.
Pasquill applied to a panel of the commission to get the order revoked, but the panel declined to do so. He appealed the panel's decision to the B.C. Court of Appeal, arguing that the Pension Benefits and Standards Act exempts LIFs from preservation orders.
"The Court of Appeal agreed with Pasquill that the PBSA exempts his LIF accounts from the preservation order," the BCSC said in its release. "Although the (Court Order Enforcement Act) was amended in 2020 to reflect the Securities Act amendments, the court noted, the PBSA was not."
"The legislation must, in my opinion, be taken as meaning that the commission does not have the authority to enforce judgments against plans that are derived from pension funds," Justice Mary V. Newbury wrote for the three-member court panel.
Though the court ruled against his organization, BCSC executive director Peter Brady said the commission remains "determined to return money to investors that has been obtained through misconduct."
"We will continue to use every tool at our disposal in our efforts to collect sanctions imposed by our panels," Brady said in the release.
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