A disgraced New Brunswick mortgage broker has now been ordered to repay his victims $600,000 and banned from the investment industry for life, an encouraging sign for tougher regulations in the mortgage industry, said the president of the East Coast brokers’ association.
“Though is it unfortunate such events took place, we believe it will help to expedite the regulatory process not only for New Brunswick but for all Canadian provinces that lack this,” said Janet McKeough, president of the Mortgage Brokers Association of Atlantic Canada. “Higher standards and increased consumer protection is necessary and positive for our industry.”
Locked up for the past 10 months, William Watson Priest – a mortgage broker in Nackawic – was sentenced to three years in September of 2012 after pleading guilty to nine counts of fraud.
McKeough told MortgageBrokerNews.ca that the current development of regulations in neighbouring Nova Scotia
in cooperation with the MBAAC will hopefully be repeated in New Brunswick.
“MBAAC has a zero tolerance for fraud,” she said. “We are committed to elevating the education and professionalism of our industry and ensuring consumers are protected “As we are doing in Nova Scotia
, we look forward to working with the Province of New Brunswick on the development and implementation of mortgage brokerage regulations.”
Beginning in 2008, Priest obtained a total of $858,782 from 11 investors, all residents of New Brunswick, the provincial regulator said.
In the ruling, Rick Hancox, the chief executive offer of the commission, stated that “The Tribunal considered the evidence presented by staff as well as compelling written statements provided by the defrauded investors. It was important that those who were defrauded had an opportunity to express the impact and effects that this crime had on them, their family and friends.”
The money was obtained with a promise of high rates of return; however, Priest never invested any of the funds. Rather, he deposited the funds collected into his personal account and then used the money to either pay other investors or kept it for his personal use.
The investors suffered an aggregate financial loss of $594,997 – money Priest is now on the hook for.