A Saskatoon real estate company controlling hundreds of properties has gone out of business and left millions of dollars from dozens of investors missing.
That’s according to court documents obtained by CTV News.
Epic Alliance Real Estate Inc., which according to its own promotional materials controlled 504 properties in Saskatoon and North Battleford – valued at $126 million in total, closed in January.
Saskatchewan’s Financial and Consumer Affairs Authority (FCAA) issued a temporary cease trade order in October.
The company’s two co-founders, Rochelle Laflamme and Alisa Thompson, informed investors of the company’s demise during a 16-minute Zoom call on January 19.
“We just couldn’t go back on the no-trade order. The FCAA screwed us over, so that’s it,” said a transcript of the call.
Attempts by CTV News to contact Laflamme and Thompson were unsuccessful.
The shutdown left investors – mostly from British Columbia and Ontario scrambling to find out what happened to their money.
Epic Alliance offered investors a “hassle-free” landlord program – managing homes for out-of-province investors.
“It’s a crap sandwich and we know you’re invested with us and we know a lot of people have stepped up for success,” they said, telling investors they now owned their properties.
Under the landlord program, the investor would take out the mortgage on the home and Epic would take responsibility for everything else, like finding tenants and maintaining the property.
This program promised the investor a guaranteed rate of return of 15%.
At one point, the couple spoke of “trying to hand over” hundreds of properties as they tried to get keys from all unsuspecting owners.
“Unfortunately, anyone who had unsecured debt…it’s all gone. It’s all gone. No more business and that’s what it is,” the transcript said.
In the video, the couple said Epic Alliance would go bankrupt.
“Unfortunately, that’s where we are. So we had to lay off just about everyone last Friday and we’re closing the doors,” the transcript reads.
The company also raised funds through promissory notes – where investors loaned money to be repaid with interest.
These notes included the loan amount, start and end date, and interest rate.
Epic requested investments between $50,000 and $500,000 in exchange for the promissory notes
The company also offered a “fund-a-flip” program, in which investors could buy homes through Epic – which would oversee improvements and upgrades – and then resell them for a profit, often advertised as a 10 return. % on a one-year investment.
“We tried. For us, we’re running out of time. We’re running out of resources. There’s nothing left,” the couple said during their Zoom call with investors.
One hundred and twenty investors have since managed to get a special investigator appointed to try to find out what happened to their money.
Court of Queen’s Bench Judge Allisen Rothery assigned accounting firm Ernst and Young to investigate potential losses estimated at $10 million to $20 million. The conclusions must be revealed to the court at the end of April.