Clients who went looking for a way to get into higher yield investments ended up leaving with a $22,000 loan and $112,000 in interest payments, a BC court heard.
A B.C. Supreme court judge made the determination, tossing out a claim from a financial services company in Victoria after it sued Christopher Bryce Laughlin and Pauline Louella Laughlin for debts unpaid.
“The Laughlins have paid $21,400 on that debt, yet the plaintiff – Connor Financial Services International Inc. – asserts that its loan agreement with the Laughlins entitles it to a further $119,000 approximately, up to the start of the trial, with more to be claimed after that,” Judge George Macintosh said. “Simply to state those numbers is to expose the agreement for the radically unfair agreement that it was.”
His comments come after the couple borrowed $22,221 from Connor Financial Services and were charged an annual interest rate of 42 per cent on a loan. The judge’s comments also back his decision to rule in favour of the defendants because their retirement saving plans and other investments were collapsed to buy mutual funds from the company.
“I find that Connor’s companies owed and breached a fiduciary duty to the Laughlins,” the judge said. Macintosh described the Laughlins as “babes in the woods” and “naive” when it came to their agreements with Connor. “The Laughlins argue that the loan agreement was unconscionable. I agree that it was.”