How am I doing?

Asset allocation, risk, diversification and rebalancing. Pros/cons of hiring a financial advisor. Seeking advice on your portfolio?
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Pickles
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Re: How am I doing?

Post by Pickles »

For folks just joining this thread, it is well worth your time to start at the beginning and read the entire thread. The initial posts show a newbie investor who got into a couple of messes due to a desire for a high yield and failure to pay due attention to all the signs of the scams he was joining. Kombat stoutly resisted the advice he received from fwf folks for some time, clinging to the hope that he could make 15% per year on his land investment and claim a charitable deduction greater than the amount he donated -- to a tax scam scheme.

However, Kombat has also proved to be a rare individual in that he has been very candid about the fallout from his decisions (made in his 20s as a newbie investor). He has faithfully updated his situation as events occurred, providing a fascinating and cautionary tale that all newcomers to investing can learn from.

What is somewhat disturbing, Kombat, is that your description of the latest offer made by S&D changes from post to post, suggesting that you may not yet grasp the pernickety details that determine whether you voted for something good, bad or indifferent.Unless and until you post the contents of the offer, it is very difficult for others here to offer their perspective.

Perhaps all this is moot since you didn't ask for advice but simply voted(and without consulting a lawyer first). Please do update us on what happens. You might also consider asking for feedback here before you make decisions, rather than after the fact. All the best. I hope you get some of your money back.
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Re: How am I doing?

Post by kombat »

Pickles wrote:What is somewhat disturbing, Kombat, is that your description of the latest offer made by S&D changes from post to post, suggesting that you may not yet grasp the pernickety details that determine whether you voted for something good, bad or indifferent.Unless and until you post the contents of the offer, it is very difficult for others here to offer their perspective.
Fair enough, I'll try and find some time this weekend to capture the text of the letter and post it here. I didn't think my description was "changing from post to post," but I concede perhaps I've done a poor job explaining it.

At the risk of offending Mr. Ed's next of kin, I'll restate as succinctly as possible: The offer from S&D was that they would obtain financing (a mortgage) and buy our units back from us at the original price we paid. They will then continue to try and sell the land (which they would now own) and if and when it sells, if there is any profit remaining after deducting mortgage interest and fees (yeah, right), said profit would be divvied up and distributed amongst us former unit holders in proportion to the number of units we held.
Pickles wrote:Perhaps all this is moot since you didn't ask for advice but simply voted(and without consulting a lawyer first).
Guilty as charged. I've been so exasperated with this whole experience that when presented with an opportunity to finally get my money back (even with no gain) and put this whole thing behind me, I jumped at it. The other option was the "status quo," where my money continues to remain tied up and completely illiquid for an indeterminate amount of time.
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Pickles
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Re: How am I doing?

Post by Pickles »

kombat wrote:
Pickles wrote:Perhaps all this is moot since you didn't ask for advice but simply voted(and without consulting a lawyer first).
Guilty as charged. I've been so exasperated with this whole experience that when presented with an opportunity to finally get my money back (even with no gain) and put this whole thing behind me, I jumped at it. The other option was the "status quo," where my money continues to remain tied up and completely illiquid for an indeterminate amount of time.
I can well imagine your desire to put it all behind you. That's how I felt when I sold (at $57) Yellow Media Bonds bought at $98. Ouch!

Some of us are curious enough to look at the wording of S&D's offer, not that any comments we make can be construed as legal advice, though. My bet is that their offer is in relatively plain language to be followed up (if majority have voted yes) by a legal document to sign. If that happens, for sure, consult a lawyer before signing! Your goal is to get rid of the investment and that's fine, but you would want to get out clean with no further obligation of any kind. Paying a lawyer to ensure that happened would be worth it.
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Pickles
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Re: How am I doing?

Post by gsp_ »

kombat wrote:
gsp_ wrote:Hmmm, what's in it for them?
As far as I can tell, protecting their image, and the fact that they've had our capital to use for the past 7 years.
Well, they've had use of your capital for 7 years regardless so I don't see that as a motivation for them. In fact if they didn't make this offer they'd get to keep using your funds for even longer so that's a motive against this offer.

Have there been any particularly loud complaints or threats from investors lately that might tarnish their image? Protecting their image is a potentially valid motivation but it's just one of many and I'd be careful attributing their offer to it without strong evidence. There are many more nefarious possibilities like the one Norbert mentioned.
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Re: How am I doing?

Post by Chuck »

What's puzzling to me (and probably most others) is what is in it for S&D to buy out the users and hold a mortgage on the land instead of selling the land outright (assmuing Kombat is correct and the value of the land has at least moved up some amount over cost over 7 years)?

Say Kombat's assumption that the land is worth 1.2X is true. Did S&D ever offer selling for 1.2X and returning 1.2X (minus fees of course) back to investors? Or is the only out this mortgage approach?

It really makes a difference if the current market value is above or below cost. If above, I can see how S&D might be able to squeeze out additional profit by buying out the investors at orginal cost and keeping a mortgage. Otherwise, why not just sell at current market and give the investors back their original investment plus whatever? Sounds like Kombat would jump at any profits no matter how meager and just move on.

If the property value is currently less than cost, paying out original cost to investors exposes S&D to a potential loss, and I don't buy the reputation preservation angle, so I suspect this is not the case.
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Re: How am I doing?

Post by kombat »

Here's the text of the letter:
Dear Valued Client:

In order to better serve our clients, S&D is currently working with a financial institution to mortgage all the land projects. To pay back principal to every UDI land owner, the financial institution requires the consolidation of all UDI’s in order to complete the payout.

S&D would like to suggest the following two options which is binding on the majority voting decision:

Option 1:

The financial institution will fund and register the first mortgage to pay out all the UDI land owners their “principle amount”. S&D will maintain ownership and management for the project and try our best to increase the value of the land by getting stages of development approval in place. When the project is sold in the future, each UDI owner will share the profit accordingly after expenses related to the project. After we receive all the voting letters and majority select Option 1 we will confirm with the financial institution and begin the process of sending out the ‘Power of Attorney Package’ and ‘Transfer of Land’ documents which must be completed and sent back. Examples will be given in the package in order to complete the forms.

Option 2:

The original contract remains unchanged. S&D will continue listing the projects through Real Estate Broker to sell. S&D will not Refund or Buy Back from UDI land owners.
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Re: How am I doing?

Post by Rooster »

That's really not very clear, and I think purposely so.

Looks to me like there is no sale to S&D, just a mortage on land to finance a payout with S&D continuing to manage (the reference to "ownership" seems to me to likely be a reference to current arrangement where S&D owns units and manages the property).

Key points:

- they ask that the units be consolidated -would likely not have an divisble interest after this;
- no indication of sale to S&D, but clear indication of S&D mortgaging the asset;
- no mention of sale price (if sale) or mortgage amount. This is incomprehensible -they could easilly know in advance of submitting to a vote how much the financial institution will lend;
- financial institution not identified;
- mention of return of principle is not the same as sale/financing for an amount equal to purchase price. First off, there is no principle, it's not a loan you made. Second, if they mean equity, it could mean current fmv of equity (whatever they deem that to be). We don't know, no numbers are provided.
- no mention of how the loan will be repaid or how interest or other payments will be made.

I actually can't believe they submitted so little information for such a crucial decision. All my "red flag" antennas are up. I'd again recommend you get your transaction documents and this reviewed by a competent real estate lawyer. Do you have contact details for the other unit holders? Would not be a bad idea for you guys to coordinate.
Last edited by Rooster on 03 May 2013 17:44, edited 7 times in total.
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Re: How am I doing?

Post by couponstrip »

I agree with those who are suspicious of S&D's motivation. This company intends to make money, and there is no limit to the amount it intends to make.

One consideration I haven't seen proposed is that the land is, in fact, now worth more than the principle amount invested by all the shareholders. After all, Alberta, Edmonton, and especially the Leduc area have been booming for over a decade with only a small blip during the 2008-2009 crash. Property values across the province have more than doubled since 2004-2005.

Inflation alone would already put the original purchase value of 2.5million in 2004 at 4-5 million+ in 2013 dollars. Not a stretch to think it may be worth more than 8 million. Perhaps much more.

None of the investors will ever know what is happening here. Most will never find out when it is sold a year from now because they will be happy to have put it behind them.

Why else would they force every unit holder into a single decision? Given the frustration of the last 7 years, they know what the majority of you are going to pick.
Last edited by couponstrip on 03 May 2013 18:18, edited 1 time in total.
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Re: How am I doing?

Post by Rooster »

couponstrip wrote:I agree with those who are suspicious of S&D's motivation. This company intends to make money, and there is no limit to the amount it intends to make.

One consideration I haven't seen proposed is that the land is, in fact, now worth more than the principle amount invested by all the shareholders. After all, Alberta, Edmonton, and especially the Leduc area have been booming for over a decade with only a small blip during the 2008-2009 crash. Property values across the province have more than doubled since 2004-2005.

The way the underworld of landbanking works, I wouldn't put it past them if they already have a semi-serious buyer who is offering much more than 8 million for the parcel. Nothing official of course. Nothing on paper.

Inflation alone would already put the original purchase value of 2.5million in 2004 at 4-5 million+ in 2013 dollars. Not a stretch to think it may be worth more than 8 million. Perhaps much more.

None of the investors will ever know what is happening here. Most will never find out when it is sold a year from now because they will be happy to have put it behind them.

Why else would they force every unit holder into a single decision? Given the frustration of the last 7 years, they know what the majority of you are going to pick.

What's in it for them? A very profitable land sale.
The sleeziest way to proceed would be to have a financial institution with whom they are in cohoots mortgage the land for a low amount -unitholders are asked to vote on mortgaging the land without mention of amount- and then have that lender take possesion of the land when there is a default under the loan. Lender can then resell the land at higher price than principle lost under the loan. It could be a way to take ownership at low amount without submitting a low bid as a purchase price (citing, after the vote, that this was all they could secure as financing).

We actually don't know what's going on. The proposal has very little information and is convoluted. Can't believe people can be expected to make a decision on whether to sell or finance based on that. At the very, very least clarify whther this is a sale or financing and name a purchase price/financing amount.
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Re: How am I doing?

Post by Rooster »

Kombat, for what it's worth, i'm not a real estate lawyer but am a corporate finance lawyer. I've come accross a few scams in my practice. All had in common missing key information/outside of market practice structures/no real explanation provided. This very much feels like that. I can't tell you for certain that it's not legit -maybe they are just very poor at drafting proposals, but it smells bad. I think you should counsult counsel while there may still be time. If possible, get other unitholders to join and share costs.
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Re: How am I doing?

Post by couponstrip »

Landbanking is a difficult investment vehicle. The small investor is at the mercy of businessmen who know more than they do. There is no easy way to resolve the information asymmetry. The whole thing is so opaque, and the sale of rural land is so illiquid, that there is no real way for this group of investors to protect themselves. Not that they will. They will just take the return of their 2006 dollars in full without interest.

Try to run a valuation analysis on the land? Good luck. No piece of land is the same. A piece of land 1km away will have markedly different value. Compounding this is that ag land sales are often not common enough/concentrated enough to create a sense of value. Further, estimated value often lags real value in a red hot real estate market.

Like Rooster says, we don't really know what is going on. It would be interesting to follow what ultimately happens with this piece of land in the next 1-2 years. Then the answer to this mystery will be obvious.

I should add that the idea of this land now being worth more than 8 million is entirely speculation on my part. I have no knowledge of S&D and their intentions nor knowledge about this parcel of land. I have no idea why they are making this move now, and their intentions may be quite honourable in returning capital to the investors due to ongoing complaints/frustration they have been receiving. If that is the case, full marks to them for their integrity.
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Pickles
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Re: How am I doing?

Post by Pickles »

Gee, Kombat, the proposal by S&D has more holes in it than a hunk of Swiss cheese! You did right to bring this to the forum for discussion. I echo Rooster's concern and advice.

1. They have NOT promised to pay back the money you invested; they've only offered to pay back the principal amount of the money they borrow, on your behalf. The mention of a Power of Attorney form for you to sign is so that S&D can take out a mortgage for you and the other investors. You will be responsible for the debt and they haven't even indicated the terms of the loan!

2. Note they say that "S&D will maintain ownership and management, not that they will buy out each investor's share. It is clear that no sale is taking place under option 1. According to their letter, the sale will take place "in the future" and at that time you will "share the profit accordingly after expenses related to the project." Those expenses will include, of course, repayment of the mortgage with interest, property taxes owing on the land, and all the management fees S&D chooses to charge you.

3. Likely, there will be no "profit" after that and there might well be a debt for you to pay off.

4. In summary, the proposal is to lend you an undisclosed amount of money at an undisclosed interest rate for an indefinite period of time from an undisclosed financial institution which may be connected to S&D. Given S&D's past track record, the new proposal is HIGHLY suspicious.

Get a lawyer so that you don't end up in a worse situation than you are now.
Regards,
Pickles
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Re: How am I doing?

Post by BRIAN5000 »

kombat wrote:Here's the text of the letter:
Dear Valued Client:

In order to better serve our clients, S&D is currently working with a financial institution to mortgage all the land projects. To pay back principal to every UDI land owner, the financial institution requires the consolidation of all UDI’s in order to complete the payout.
Would you be able to provide a link to their S&D's website?
This information is believed to be from reliable sources but may include rumor and speculation. Accuracy is not guaranteed
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Re: How am I doing?

Post by mcbar »

S&D's website is here.

Kombat, while I don't feel sorry for you per se, I certainly empathize with your position. I read the entire thread - what an ordeal. You've certainly handled it with more grace than I think I'm capable of. Thanks for sharing your experience so that others can learn from it.

That said, I really hope you will take the advice that's been given to you by many good, intelligent folks on this forum and others and get a lawyer before you proceed with anything.

This company ripped you off from the moment you started dealing with them by selling you land at four times the price they paid for it. The promises of profit they made you turned out to be hopelessly, misleadingly, unrealistically optimistic. Nothing they have done thus far suggests they have your interests in mind. What would have changed?

You mention their reputation with the BBB. Have you made a report with them based on your experiences? If no, why not? Why haven't other "investors"? What they've done may certainly be "legal", but it's far from legitimate.

Could it be that hiring a lawyer feels a bit too much like admitting that the company has taken you for a ride? It seems you're still holding onto the hope that some profit will result from all of this. For your sake, I think it's time to let go of that hope and aggressively pursue getting your capital back. You have said you learned your lesson, but it still seems, from the tone of your posts, that you trust these skeezbags. I hope I'm misinterpreting you.

We're talking about, say, 20% of your net worth? Potentially more if you get saddled with a bunch of bad debt? Reality check. If you have the time and money to go on vacation every year, you have the time and money to get in touch with a lawyer. Consider the lawyer's fee an "investment" with a potential return of $80000. You may want to sit your wife down and have her read this entire thread too, so she can see what honest people who have nothing to gain think of your situation.

I hope I am not coming across as rude. This is the exact advice and phrasing I would use if someone I cared a lot about was in a situation like yours. Please take the advice that's been given to you and hire a lawyer before you do anything else.

Good luck, respectfully, and thanks again for sharing your experience.
"The mob rushes in where individuals fear to tread." --BF Skinner

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Re: How am I doing?

Post by kombat »

I haven't "aggressively pursued" getting my capital back yet because it appears the wheels are already in motion to have it returned to us. I don't want to prematurely turn this situation into an acrimonious one and have S&D switch decisively into "defensive" mode - I want them to continue to work toward giving us back our money voluntarily. As long as they appear to be progressing toward some sort of conclusion, I'll be patient.

Likewise, I haven't opened a complaint with the BBB because it's not over yet. It would be premature to write anything before the saga has concluded.
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Re: How am I doing?

Post by Chuck »

The two big issues are:

1) Kombat and other investors know what their original investment is, but have no idea what the current value of their properties are.
2) "each UDI owner will share the profit accordingly after expenses related to the project" - way too vague. What liberty has S&D got to charge fees, etc.

Sounds like a great deal for S&D, they hold all the cards.

I note with interest it does not seem to be just your property that is in question, the letter says all land projects. So basically S&D wants to change their entire business model. How would they market to new investors in the future I wonder? Their is no longer any "original investment" to pay back so are they giving up on new clients? Or will it be more of a REIT type deal - ie. give us some money, we'll manage properties, charge you fees, and hopefully you profit.
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Re: How am I doing?

Post by ockham »

I've just had the mixed pleasure of reading for the first time about Kombat's real estate investment troubles. While the latest iteration of a proposed mortgage from an unnamed financier doesn't make a lot of sense as presented, I overall have a somewhat different take than other posters.

1. I don't necessarily or automatically assume that the principals of S&D are crooked. They may be. But they may themselves just be cowboys. The document posted is consistent with either hypothesis. This is a residential development around a golf course. The time when this scheme was put together was a time, remember, when residential real estate values only went up -- particularly residential real estate with a recreational aspect. That culture attracted a lot of dumb money and sloppy thinking, from lenders through developers through investors. Plus, face it, some of that dumb money/sloppy thinking at all levels of the chain made a lot of money in some of those situations.

2. But, IMHO, it doesn't really matter whether they're crooks or cowboys. The fundamental characteristic of this whole transaction is the power and information asymmetry. Kombat has none of either, the crooks/cowboys have all of both. Therefore, IMHO, it's a bit of a waste of effort to try to figure out what S&D is truly up to. Whatever it is, this is a transaction that Kombat should be exerting every effort to just get out of. Period. The fundamental asymmetry is never going to change or go away, and it's this asymmetry that's the real problem.

3. But getting out completely means giving up on the dream of making money on an eventual sale. Greed is a powerful emotion. Time to deal with it. Fortunately, we know enough about Kombat's personal circumstances to know that coming to grips with greed on this transaction will not be financially crippling for him.

4. By all means, then, go to your lawyer. But include in the legal review strategies for negotiating a complete, final exit.

5. Investor, know thyself.

YMMV.
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Re: How am I doing?

Post by Benchwarmer »

The landbanking arrangement reminds me of the mortgage-backed securities that the investment banks were peddling to pension funds in mid-2000.

The banks knew everything about the securities (after all, their lawyers drafted them up). The buyers knew nothing, other than the AAA from the rating agencies. As it turned out, the rating agencies knew nothing either, and had to be coached by the investment banks on how to do the rating.

The securities were designed to fail. They were also designed to maximize profits for the banks. It was all so one-sided, but yet it all looked so legitimate at the time.

I think that the lessons learned here can equally be applied to investing in general.
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Re: How am I doing?

Post by arrow1963 »

I just read through the thread from the start, and had a number of 'ah-ha' moments, relating to conversations that I've had with my Dad, who invested in a series of landbanking projects between 2007 and 2011. I started a thread a little while ago relating to ongoing issues with one of those investments in Belize.



There are a lot of similarities between the conversations that we've had, and what was said on this thread, especially between pages 2 and 4. I don't want to pick on the OP, who has been great at actually keeping this going over 6 years, but at a number of different points this thread mirrors the conversations I've had. I'm sure you feel bad about this now, and hate that posters overgeneralize with regards to what you think. So, lets say that this is my dad:

Pessimist: I don't think this is a good investment. We don't know how the promoters make their money, how much they make, and how much of the development is 'sold' rather than 'bought'. These investment returns seem cherry-picked, and their 'goal' return bears no relationship to what you'll receive. Why not invest in something diversified, liquid, and which has the benefit of regulatory oversight? Have you seen 'Glengarry Glen Ross'?

Rationalizing Investor: I don't think this is a scam. I called the office (or was mailed the land deed), so I know that the land itself is real. The company is real.

There's a disconnect here. The guy on the street sees something complicated, thinks 'you have to take risks to make money' and then worries afterwards 'is it a scam'? Like, a literal, criminal "we take all your money and run away to Mexico" scam. They're not thinking about information assymetries, or the fact that the landbanking company is able to write every clause of the contract to be pursuant with their own interest. They're worried about the guy in a striped jumpsuit, not a pinstriped suit, even after they've had a bad enough experience with big bank mutual fund salesmen to wade into the deep end of the investing pool. The real money in managing money isn't made by stealing it, it's made by getting consent to keep skimming it off the top. "Where are the Customers' Yachts?"



To the OP: Good luck. My spidey senses tingle at the thought of "we'll borrow money to pay back your money, and then you'll be good for any upside, but we promise that you won't lose any money". It seems complicated, and another instance for 'them' to stack the deck in their favor.

I guess my biggest question would be "why now?". If everyone can get their money back, why haven't they done this before? Mortgage rates haven't fallen recently, they've been really low for a long time, and it can't be that the property has appreciated in a meaningful way recently. I'm guessing that they'll say that they want to preserve their spotless corporate record of success, but what are the chances that investors are starting to get desperate?
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Re: How am I doing?

Post by kombat »

Well it's been a while, so perhaps another update is appropriate.

Land Banking/S&D Deal: I had hoped there'd be some movement on this issue by the end of the year so we could put that money into our mortgage before our annual extra principal payment allowance rolled over, but that's not going to be the case. I emailed a representative at S&D and it seems they're still waiting for the rest of the votes from the unitholders (or at least enough to constitute a plurality). I guess some people had moved and not updated their contact information, and some people are simply procrastinating at returning their voting forms. I'm still hopeful to get some money back from this next year (because what other options do I have?).

Parklane Donations Scam: I was surprised last week to receive a letter from the lawyers arguing the class action lawsuit. Apparently several of the defendants named in the suit have opted to settle, and there is a settlement fund available for dispersement amongst donors. The letter included a claim form for us to return with documentation supporting our claim (basically asking for proof of how much actual cash we'd donated to the scheme) for our pro-rated share of the settlement fund. I asked the settlement fund administrator if they had a ballpark estimate as to how much of our original donation we could hope to have returned (50%? 25%?) but they couldn't even speculate. I had pretty much written that money off completely, so in my opinion, anything we receive back is just gravy.

I'll post more updates as developments occur.

Other aspects of our finances have been trucking along pretty smoothly. We've long since paid off all of our other debts, and our only remaining debt is our mortgage, at $236,000. Our house was assessed at $500,000 during MPAC's last appraisal a couple of years ago, and an identical model on our street with a smaller lot and fewer upgrades sold this summer for $474,000, so I think $500k is a reasonable estimate.

We've also got $10,000 set aside for travel, $9,000 to replace our car, $11,000 as an "Emergency Fund," $5,000 in our TFSAs, and $181,000 in RRSPs. Plus the land out in Edmonton ($80k?). We've been making extra payments on the mortgage as much as possible (usually around $2,600/month over and above the regular $1,700/month mortgage payment).

We've learned a lot from this forum, and these experiences have made me extremely cynical and jaded with respect to scammers, "investment clubs," financial advisors, and basically anyone who approaches me with any kind of "opportunity."
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Re: How am I doing?

Post by Pickles »

kombat wrote: Parklane Donations Scam: I was surprised last week to receive a letter from the lawyers arguing the class action lawsuit. Apparently several of the defendants named in the suit have opted to settle, and there is a settlement fund available for dispersement amongst donors. The letter included a claim form for us to return with documentation supporting our claim (basically asking for proof of how much actual cash we'd donated to the scheme) for our pro-rated share of the settlement fund. I asked the settlement fund administrator if they had a ballpark estimate as to how much of our original donation we could hope to have returned (50%? 25%?) but they couldn't even speculate. I had pretty much written that money off completely, so in my opinion, anything we receive back is just gravy.
Why on earth could they not give you a ball park figure? They must be privy to how the settlement package works in order to advise you whether the offer is reasonable or not.
Regards,
Pickles
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Re: How am I doing?

Post by kombat »

If I had to guess, I'd say it's because they don't yet know how much of the pot they (the lawyers) will be allowed to raid. They've been approved for 25% but are applying for an additional 8%. Also, I suppose it's possible they don't have accurate numbers for how much each donor contributed. Our letter included a dollar amount that they said Parklane's records showed we had contributed, but it was incorrect (it was off by about 9%). I imagine if they made similar errors on everyone else's claim for too, it could make it difficult to pin down how much we could hope to get back.

But I suspect the real reason is because they're lawyers and wish to preclude the possibility of giving me a number, then having the actual number come in lower than their estimate, and having me come back with a lawsuit against them saying "You said we'd get back 35% but we only got back 32%!"
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Location: Waiting for the real estate meltdown on Rua Açores.

Re: How am I doing?

Post by parvus »

I won't throw the blame on the lawyers and trustees. In any recovery plan, there is work tracking down the assets, securing ownership and liquidating them -- and the lawyers and trustees have to paid.

It may seem unfair. But you have to unsquirrel assets that have been squirrelled away. Unfortunately, it costs money.
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kombat
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Posts: 929
Joined: 26 Feb 2007 09:23
Location: Ottawa, ON

Re: How am I doing?

Post by kombat »

A couple updates.

Regarding the land banking deal, 53% of the unitholders who responded voted for the "get a mortgage and pay us back" option (as opposed to "sit tight and keep trying to sell it"). S&D has submitted the proposal to the bank and is waiting to hear if the bank will fund the mortgage. It's been over a month - how long do banks usually take to decide whether or not they're going to make a loan?

Regarding the Parklane charitable donation scheme, a couple of developments there, too. The "test case" against the CRA has been settled, with the CRA agreeing to reassess everyone who submitted a "Notice of Objection" (which my wife and I did) and to allow the actual cash donation (it was previously disallowed) to be deducted as a charitable donation. Of course, the fictional "in trust" units will still be disallowed, but that's understandable. In our case, the actual cash donation was around $11,000. So hopefully we should get a few hundred/couple thousand dollars back.

On the same issue, the class-action lawsuit against the program organizers is proceeding, with some of the defendants opting to settle. So a pool of cash is available to pay the members of the class action lawsuit (which includes us). We should be receiving a proportionate amount of the settlement funds concordant with the amount we contributed compared to the rest of the class. Of course, this will only be a fraction of what we actually paid, and the lawyers have been unable to tell me even a rough estimate of how much that will be, but I guess anything is better than nothing.

tl;dr - 8 years in, and I have yet to receive 1 penny of recompense, but wheels are turning.
kombat
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Joined: 26 Feb 2007 09:23
Location: Ottawa, ON

Re: How am I doing?

Post by kombat »

I suppose maybe a quick update on the rest of our finances would be appropriate, too, since that was kind of the original point of this thread. :) Since our missteps many years ago, I've steered us in a much more conservative direction with investing and finances. We've been focusing our money on eliminating debt and paying down our mortgage.

I'm determined never to borrow money for major purchases again, so we've established savings funds to pay for things like vehicles and travel. We've been on a Mediterannean cruise, a Caribbean cruise, Hawaii, and visited relatives in Vancouver, Edmonton, and the Maritimes, all paid for with cash. We also recently bought a used car (2010 Mazda 3, $14,500) with cash.

We've paid our mortgage down to around $223k, and our last property tax assessment pegged the property at $500k, so we've built up some nice home equity. Finally, although we haven't added anything new to our RRSPs, the markets have helped propel them upwards quite spectacularly since 2008, and they now sit at around $200k combined. With another $35k or so in cash in our savings accounts and TFSAs, our total net worth currently sits at $600k. We continue paying extra on our mortgage every month, and should have it eliminated completely in another 3-4 years, tops. We're both currently 38 years old.
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