Oudovikine affidavit, Royal Canadian Mounted Police, RCMP, Commercial Crime Unit, Newmarket, Canada

Next day, he called us and said that we should go to the CIBC branch located at Dufferin and Bloor Street and see Ms. Sue Fedorink. Our loan had been approved before even meeting with the CIBC senior loan officer.

[…]

She replied that it is their practice and hung up the phone.

The next day Country Style has called us and gave us a key, to see store inside. All our previous requests to see store inside were declined. As soon as money was withdrawn from our account they gave us a key. When we opened the store, we were crushed. All the equipment that is supposed to be brand new was around 10-12 years old. I immediately called Country Style and asked about that. They said "this is it, deal is done".

Old for New Equipment (missing $120,000)
I went to CIBC to see Fedorink. I asked her if I can see the loan documentation, such as list of equipment, prices and receipts, sales pro forma and rest of the documents which bank must obtain according to CSBFA regulations. She refused.

I asked her if she knew that all this equipment was 10-12 years old. I asked her if this was why she immediately transferred money from our account because she knew we would have never bought the store if the equipment were junk. (Later on, I became convinced this was the case.) She asked me to leave her office.

I am convinced that the draft for $129,500, drawn on a transit that isn't a branch, was the "off-the-books" amount. Why else would there need to be two drafts (two transits, different signatures) for the purchase of one franchise? I presume only the other draft ever was declared as revenue by Country Style and the $129,500 funded the arrangement. (Noble acted for months on our behalf and we only paid him less than $4,000.)

Royal_Canadian_Mounted_Police.svg

Sworn narrative written for Royal Canadian Mounted Police, RCMP, Commercial Crime Unit, Newmarket, Canada

To: Royal Canadian Mounted Police, RCMP, Commercial Crime Unit, Newmarket, Canada
From: Mr. Andrei Oudovikine
Date: July 1, 2005

My name is Andrei Oudovikine. I am one of the many frustrated people who have been unfortunate enough to get involved in Canadian Small Business Financing Program within the Canadian Imperial Bank of Commerce, CIBC.

So, here is a story

Evaluating Business Opportunities
Me and My father had a dream to build a business of our own, to be own bosses, so called “big dream of life” and we started considering different business opportunities. And one day we have received newspaper with advertising of Franchise Show. We went there to see different businesses, and Country Style exhibition has caught our attention. After brief discussion with Country Style Sales representative (Kent Chin) they have convinced us to complete New Franchisee Registration Form. We have done it. Two days later Kent Chin has called us and asked me if we would like to come for Country Style Open House, which was held at Country Style Head Office.

Presentation which was presented, was very good, and impression we have received, was that Country Style is a greatest business opportunity in Canada, and that only SELECTED people can be a Country Style Franchisee. They have explained that main reason why Country Style is so successful I because Head Office is providing a great deal of support to their franchisees, starting from getting a financing and to the day by day operations, and this is a main strategy of Country Style: to build strong relationships with franchisees. Any problem franchisee has, it is problem of the Head Office, and they do whatever it takes to solve it. Sound nice! Several days later, Jeff Young (Director of Franchise Sale) start calling me almost every day, offering different Country Style stores. Most of them were old corporate stores which were on sale several months or even years. But he saw our true interest to start own business, he insisted on a meeting “to discuss new opportunities”. One day he called me and said that there is a new great store, new concept store, and that store was sold many months ago to another person and that person had a very dramatic health problem in a family and this store has become available just now, and that he gives me a BRILLIANT opportunity to get this tore, BUT we have to act quickly, because there is a LINE FORMED BY OTHER BUYERS who are anxious to buy this new prototype store.

We asked him what is the price for this tore and he said it is $350,000. We told him, that we only have $100,000 it is all our life savings (my own and my dad’s). Mr. Young said that we should now even worry about money if there is a will, there is way. He said if we made an offer he will find us a rest of the money, and it is not even our problem.

I was very surprised about it, because I tried to apply for financing myself and my application was declined (four banks, including CIBC's Commerce Court branch). It seemed the small business loan (federally-insured loans under the Canada Small Business Financing Act or CSBFA) is very strict. But he assured me that he has a way to make it happen. SO we made an offer.

Sales Agent and Loan Officer Relationship
After that we were introduced to a man named Roger Noble. He was a franchise consultant and he owned a company called Choice Corporation. Noble said that he would consult us on all aspects of business purchase (from start to finish).

Many consultants specializing in franchise sales or financing are members of the industry organization, the Canadian Franchise Association. Noble's company is listed at: http://cfa.ca/members/support_franchise.html.

Me and my dad were very cautious about the purchase of the business because it was a big commitment and we had to put all our life savings on a line. Noble told us because this business will be financed through Canadian Small Business Financing Program, and this is a Government Program, the bank will have to go and perform Due Diligence process, obtain all sorts of documents, such as equipment prices and receipts, sales pro formas, etc.

Most importantly, the bank had to perform a verification of the repayment ability of the borrower before granting us a loan. And if bank is not satisfied with something, they will never grant us a loan. The bank had its own regulations and requirements, would not put their money at risk if this business opportunity is not solid and would say no if they lacked the confidence that this loan will be repaid. As a conclusion he said that none can make a false statement to the bank on a loan application, and it is a criminal offence.

Well, it sounded very convincing for us. After we had two interviews with Country Style. I have received a call from Mr. Roger Noble, he asked me for my father’s and my notice of assessment for past years, statements from all our accounts (personal checking and savings, RRSP and so on), and our credit history. I asked him if he wants us to get anything from Country Style (sales projections, list and price of equipment, list of expenses). But he said that he would do it himself. Noble filled out blank CIBC loan application forms for us at a meeting in a downtown coffee shop.

Next day, he called us and said that we should go to the CIBC branch located at Dufferin and Bloor Street and see Ms. Sue Fedorink. Our loan had been approved before even meeting with the CIBC senior loan officer.

It was very strange because, from my experience, it takes for the bank 1-3 weeks to perform Due Diligence and verify repayment ability of the borrower. But in this case it was like 5 days.

I asked Roger about it, but he said that he has a personal connection with this bank and had dealt with Fedorink often before. We went to the CIBC and met Sue Fedorink (the only meeting). She said that everything was done and we only had to sign and that would be it. I asked her if anything else is needed, some documents from Country Style. She said that she has all she needs and this business opportunity is solid and bank is absolutely sure that this loan will be properly repaid. She also opened Business Account and all our money was immediately transferred to this account, she also said that all loan proceeds would be deposited to this account. (I understand Noble has since moved on to deal exclusively with the TD Canada Trust bank.)

CIBC's Purchase of Franchise with Our and SBLFA Money
Next day when I went to the bank to check balance of the account I was extremely surprised to see a zero balance. All the money (our own deposited funds and all loan proceeds) was gone. I immediately called Fedorink of CIBC and asked her what happened to the money, where did it all go. She said that she already transferred all the money to Country Style. I asked her why, who authorized her to do that, as it my knowledge w have never signed an authorization form, allowing CIBC to perform any transaction on my behalf.

She replied that it is their practice and hung up the phone.

The next day Country Style has called us and gave us a key, to see store inside. All our previous requests to see store inside were declined. As soon as money was withdrawn from our account they gave us a key. When we opened the store, we were crushed. All the equipment that is supposed to be brand new was around 10-12 years old. I immediately called Country Style and asked about that. They said "this is it, deal is done".

Old for New Equipment (missing $120,000)
I went to CIBC to see Fedorink. I asked her if I can see the loan documentation, such as list of equipment, prices and receipts, sales pro forma and rest of the documents which bank must obtain according to CSBFA regulations. She refused.

I asked her if she knew that all this equipment was 10-12 years old. I asked her if this was why she immediately transferred money from our account because she knew we would have never bought the store if the equipment were junk. (Later on, I became convinced this was the case.) She asked me to leave her office.

I am convinced that the draft for $129,500, drawn on a transit that isn't a branch, was the "off-the-books" amount. Why else would there need to be two drafts (two transits, different signatures) for the purchase of one franchise? I presume only the other draft ever was declared as revenue by Country Style and the $129,500 funded the arrangement. (Noble acted for months on our behalf and we only paid him less than $4,000.)

Problems with CRA
According to the loan agreement our loan was $232,500. When we did our income tax, we have claimed $232,500 as Small Business Loan to purchase the equipment, Canada Revenue Agency (CRA) has asked us to provide receipts to support the claim. We could not do that because we have never been able o obtain them. CRA has forced us to make an official appraisal. The appraisal has revealed that all equipment is worth between $30,000 and $40,000 at the best. CRA also told us, that if we do not have receipts for all equipments which was claimed for $232,500 we have to go back to the bank and ask them for the sales receipts because bank must have them according to CSBFA to estimate the amount of the loan. CRA notified us that due to increased number of fraud involved Canadian Small Business Financing program they will only accept proper sales receipts confirming total amount of assets purchased as results of loan proceeds for $232,500. They cannot understand how we end up with 10-12 years old equipment, which barely worth $30,000 but paying $232,500.

The CRA is also looking forward to an explanation of what happened with rest of the money because on the money orders (that were issued by CIBC to Country Style) my father's and my signatures were not there. The CRA strongly suggested we go back to CIBC and obtain the necessary documentation that will support our tax report. We have tried but have been unsuccessful.

CIBC Relationship
Since June 21, 2004, we had notified senior officials with CIBC, of questionable small business lending. We have provided names, document details and a very thorough formal complaint letter. We believe we have acted in good faith and provided more than enough information for the CIBC to investigate and act in good faith with us.

We also have also had letters sent on our behalf to Mr. John Hunkin, former CEO and President, Mr. Charles Scrivener, General Manager of Franchise and Commercial Finance Programs and Mr. Rob Paterson, Senior Vice President of Small Business Banking of the CIBC. We have not received any response from any of these senior officials.

All banks organize themselves in franchise banking groups. The contact information for CIBC and their peers is found at http://cfa.ca/members/support_banks.html.

We have also had two meetings with CIBC staff. One staff said that CIBC didn't care about CSBFA losses because "it's not our money". At the conclusion of the second-to-last meeting, the CIBC officer stated they are ceasing all communications regarding this matter.

National Customer Care Complaint
We were forced to formalize the complaint to CIBC National Customer Service on September 7, 2004 and to CIBC Ombudsman on December 1, 2004. While it has been over ten months since this case was under investigation by CIBC, senior management has known about these problems for over eleven months.

Mr. Rob Paterson, Senior Vice-President, Small Business Banking
Mr. Charles Scrivener, General Manager Franchise and Commercial Finance Program
Both of these senior CIBC officers have known of these difficulties since June 21, 2004. They have chosen not to reply to the three letters we have sent them. By their inactions they have brought disrepute to the financial institution community.

We believe these and other senior managers have created, at least, the perception of a conspiracy, breach of duty, and fraud within CIBC and continue to actively cover up wrongdoings.

CIBC Ombudsman
Mr. Lachlan MacLachlan, Ombudsman and Senior Vice President refused four times to meet to discuss the complaint. He subsequently refused to communicate further about the complaint. MacLachlan was personally notified about my problems on December 10, 2004. A copy of this correspondence was also sent to Mr. John Hunkin President and CEO, Gail Sparks, Joanne MacLeod Senior Manager Director's Office, Customer Care, Josef Timar Coordinator, Office of the CIBC Ombudsman and Sandra Fitzgerald Manager Office of the CIBC Ombudsman.

No answer has been received.

Second time Mr. Lachlan MacLachlan has been personally notified about our concerns, regarding questionable small business lending practice on December 11, 2004. Copies of this letter were also sent to Hunkin and Gail Sparks, Joanne MacLeod Senior Manager Director's Office, Customer Care.

Again, we have not received any response

Additional requests were sent on December 21, 2004 and January 14, 2005. These requests were copied to John Hunkin President and CEO and Josef Timar CIBC Ombudsman. Still no reply.

Mr. Mario G. Racco, MPP Thornhill sent MacLachlan a request on my behalf, in December 2004. Several weeks later, MacLachlan has replied: "I ask Andrei Oudovikine or his father call me if there is any requested information or issues that has not been addressed. I can be reached at 416-861-3313 or at moc.cbic|nalhcaLcaM.nalhcaL#moc.cbic|nalhcaLcaM.nalhcaL. I have been advised by office of Mr. Mario G. Racco MPP Thornhill to contact MacLachlan and schedule meeting in order to discuss all issues and resolve this dispute.

The Office of the Privacy Commission of Canada
I also have been advised by Ms. Sarah Gawman, Senior Privacy Investigator from the Office of Privacy Commissioner of Canada to contact MacLachlan and try to schedule meeting in order to resolve all issues in quick and confidential manner. Three files have been opened alleging CIBC's violations of the Personal Information Protection and Electronic Documents Act, PIPEDA.

On March 1, 2004 I called MacLachlan and he verbally agreed to meet with me. During this telephone conversation he asked me what issues I want to discuss. I told to MacLachlan that my primary concerns were questionable small business lending practices within CIBC. Mr. MacLachlan asked me to send him my contact information and I have sent follow up e-mail several minutes latter.

On March 29, 2005 I have received e-mail from Mr. MacLachlan, asking again what issues I would like to address.

On April 5, 2005 I have sent an e-mail outlining issues I would like to address during a meeting and asking to obtain some documentation related to my case. Very detailed list of concerns, questions and documents was also supplied.

Ombudsman for Banking Services and Investments
My complaint was accepted and a decision rendered on June 9, 2005.

Financial Consumer Agency of Canada
An investigation is ongoing.

Outstanding Request for Loan Documentation
This request has been outstanding with CIBC since September 30, 2004. As soon as this request was received by Mr. Jeff Brown, Team Leader of Small Business Banking Toronto East, his reply was: "I am ceasing all communication with you on this matter and I will not be responding to you any more".

I found it very suspicious that every time when I ask CIBC to provide me with copy of my loan documents, which CIBC has to obtain and maintain according to CSBFA Regulations, CIBC immediately ceased all communications with me and refused even to discuss this matter. It forces me to believe that CIBC does not have loan documentation or destroyed them, in order to cover up negligent or fraudulent lending practices.

On April 8, 2005, after many fruitless attempts to meet, MacLachlan answered me by saying that "I regret that you have come to this conclusion without giving me the benefit of what I consider to be a more reasonable time frame to review my circumstances and request. And I accept your decision to seek for remedy elsewhere and I have now terminated review of your concerns."

We believe by approaching MacLachlan since December 10, 2004 we have acted in good faith, going well beyond what is reasonable to engage CIBC in trying to resolve this matter. We have asked four times for a meeting but been refused or obstructed at each opportunity. Refusal to discuss my issues only forces me to seek for remedy elsewhere.

Mine is only one Example
During last 11 months when I have been dealing with CIBC trying to resolve this dispute and during a process of investigation, I have discovered that many other CIBC customers are having the same problems. What is even more suspicious is that majority of these customers have dealt with same bank, same branch of this bank, and same lending officer. In all of these cases, CIBC is constantly refusing to talk about lending issues and provide any documentation. I would like to ask Mr. MacLachlan if CIBC Ombudsman office is willing to accept and investigate a complaint brought by a collective group of customers of the bank.

I know CIBC has violated the Bank Act, Canada Small Business Financing Act and Regulations, PIPEDA, Small Business Banking Code of Conduct (Openness , Credit Process, Accountability, Complaint Handling) and the Arthur Wishart Act (Franchise Disclosure) 2000 in my situation.

I believe other banks routinely do exactly the same things to not only franchised but independent businesspeople.

Unfulfilled Request
I understand that CIBC has terminated review of my concerns but my request for documentation and meeting remains. I have attached an inventory of requested documents.

CIBC has unconscionably delayed the evaluation of an extremely simple concern. They have acted only in their self-interest, in bad faith and communicated to third parties knowing they would attempt to intimidate my family and me. When absolutely forced to respond, their statements are as insincere as above the law they fell themselves to be.

Careless Small Business Lending Practice and absence of Due Diligence
We expected CIBC to approve and administer small business loan in accordance with the due diligence requirements of the Canada Small Business Financing Regulations, and loan complies with all the eligibility requirements of the Canada Small Business Financing Act and Regulations.

We expected CIBC to obtain, or at least require to obtain, documentation, which is necessary to approve the loan, establish right amount of the loan, and schedule loan re-payment term. According to the Canada Small Business Financing Act realistic sales projections figures must be used for an assessment of the repayment ability of the business and for calculation of monthly loan payments and re-payment term.

As part of financial audit process, It has been discovered that funds of our Small Business Loan, have never been actually made available to us. Right after the approval of the loan, all the money were immediately transferred by CIBC officer directly to the third party (Franchisor)

Statutory Lending Obligations
When we requested CIBC to provide us with a copy of Business Plan with Sales Projections, which we used by CIBC during approval process (according to the Canada Small Business Financing Act, Due Diligence Documentation Check list it must be kept on file), CIBC just ignored this request. We also requested CIBC to provide us with copies of documents that had to be acquired during loan approval and administration process:

1. Evidence, to support the cost of assets financed (i.e. invoices, contracts, purchase and sale agreements, etc.)
2. Evidence, to support that the assets financed by the loan, were paid (i.e. cheques, vendor's receipted invoice, or vendor's declaration)

  • a full description of the asset and/or service (leasehold improvements, etc…) including, quantity and price,
  • date of transaction,
  • name and address of the recipient of the payment, and
  • signature of the recipient either on the voucher or on the receipt if the payment is made in cash or in kind

3. Copy of Asset Purchase & Sale Agreements with a detailed breakdown of asset, vendor, model type, quantity, sale price, amount paid for each asset leasehold improvements, etc.)
4. Copy of Contracts/Invoices for Leasehold Improvements
5. Copy of Purchase Orders/Invoices for Equipment
6. Copy of Orders/Invoices if business is disposing or substituting any assets (with a detailed breakdown of asset, vendor, model type, number, sale price, date and amounts paid for an assets)
7. Business Plan and Cash flow projections for business. (min 12 month period)
8. Copy of most recent financial statements for existing businesses (Franchise etc…min 2 yrs, if possible)
9. Loan Balance with detailed breakdown (Equipment, Leasehold Improvements, Principal, Interest etc….)

Since CIBC has failed to provide us with requested documentation, we assume they had never obtained it and no due diligence was done for this loan

We allege the CIBC has acted unfairly, shown bad business practices and breached accepted industry standards and practices in the evaluation and placement of this loan.

Specific Allegations
We believe CIBC official(s): breached their duties of honesty, good faith, care and skill and as defined in subsection 158 of the Bank Act, must have violated section 16 of the Canada Small Business Financing Act, committed various offences under numerous sections of the Canada Small Business Financing Act Regulations and violated section 3 of the Ontario Arthur Wishart Act (Franchise Disclosure), 2000.

Fedorink failed in her duties by not having or assuming the accuracy of the following documents that are material facts in lending within the franchise industry: no and then grossly inaccurate pro forma financial statements, no business plan, no independent equipment appraisal, no evaluation of repayment ability of the borrower.

In addition to the initial breaches by Fedorink last fall, two senior CIBC officials have been aware of these serious violations since June 21, 2004 (Scrivener and Paterson). While these senior officers may have acted in good faith regarding the bank’s best interests, their inaction, in our opinion, in remedying or militating our losses has breached their duty under section 158 of the Bank Act (e.g. failure to act in good faith and exercise the care, diligence and skill that a reasonably prudent person would exercise in comparable circumstances).

Current account fund removals
My only business account is CIBC 01902 91-03511. We asked CIBC to provide the following details on the below listed transactions:
• the documents that authorized CIBC to transfer money out of this account,
• the names and positions of the CIBC officials who authorized the transfer(s) and
• the destination of these funds

1. August 21, 2003 for the amount of $2,538.62.
2. August 21, 2003 for the amount of $129,499.62.
3. August 22, 2003 for the amount of $184,850.88.

We asked CIBC to provide the details (documents, names and positions and destination) of CIBC's unauthorized loan proceeds removal that whistled through our current account (while picking up +$80,000 of our money) on August 21 and 22, 2003 (CIBC account 01902 91-03511).

It is my understanding that unauthorized and undocumented movements of cash are categorized as theft.

We asked CIBC to provide the details (documents, names and positions) of the CIBC officials who allowed my overdraft to exceed its $2,500 limit (see CIBC & Andralex Food Services Inc., Credits to you Agreement, August 8, 2003 and August 11, 2003 and CIBC account 91-0351 on October 2, 2003, balance <$7,017.21>). This transaction has never been reversed and has resulted in a direct loss to my company.

Confidentiality (information on complaint to franchisor) and Bullying
We support our families from the operation of a Country Style franchise. It is well known that franchise relationships are one-sided and prone to franchisor opportunistic behavior.

Immediately, right after our complaint was forwarded to CIBC, we start receiving a letters threatening termination of our franchise agreement from our franchisor that were based on selective enforcement of a clearly frivolous matter. We believe CIBC has not kept our complaint confidential and are obstructing this investigation and covering up wrongdoings.

On November 24, 2004 we have sent a letter regarding confidentiality concern to Ms. Gail Sparks, Senior Manager, Director's Office, CIBC Customer Care. While I was pleased to hear that our confidentiality concerns are being addressed by CIBC, my complaint experience so far provided me with very little confidence in further promises.

On December 8, 2004 I have received a phone call from Ms. Sandra Fitzgerald, Manager of CIBC Ombudsman, regarding “questionable small business lending" complaint. I asked her for the opportunity to meet and discuss complaint during one-on-one private meeting.She refused.

I was forced to be engaged in very dramatic and emotional conversation, and discuss very private and sensitive financial issues over the phone in front of all my co-workers (15 people). I was forced to provide her with exact names of the people I have dealt at CIBC, Country Style and so on.

On the next day, December 9, 2004, Roger Noble, president of Choice Corporation, called me. He had acted as a third-party sales consultant in the initial purchase of the franchise. Mr. Noble demanded an explanation why I was complaining to the CIBC. Taking into consideration sensitivity and importance of these issues, I refused to speak with him. On December 12, 2004, I received e-mail from Roger Noble regarding same problem. Noble called and left a message with Mr. Les Stewart, my advisor.

On December 9, 2004 right after telephone conversation with Ms. Sandra Fitzgerald, we sent an authorization letter to Gail Sparks/Joanne MacLeod Senior Manager, Josef Timar Coordinator, Office of the CIBC Ombudsman and Sandra Fitzgerald Office of the CIBC Ombudsman authorizing Mr. Les Stewart to deal with CIBC in regards of “questionable small business lending" Complaint.

We have advised CIBC staff, and particularly Ms. Fitzgerald, of our wishes not to be contacted. We understand it is our right to nominate an advocate.

This arrangement was necessary because of the adverse health affects arising from Ms. Fitzgerald's investigative techniques. Her intimidation tactics may very well constitute a Confidentiality and Bullying issues for future review.

Several letters were sent on my behalf to Mr. John Hunkin, CEO and President of CIBC and Mr. Lachlan MacLachlan, CIBC Ombudsman, asking to contact us, as soon as possible, due to the fact that our business is in imminent danger of financial ruin because of actions that have taken place in the last few days. This was the third but far most blatant violation of client confidentiality that we have experienced.

It is very common in franchising for a franchisor to act opportunistically in protecting their interests. We believe our franchisor, Country Style, and CIBC have a significant commercial relationship. We do not want to suffer additional loss by any predator acting to preserve mutually lucrative relationships. If our franchise were terminated, while it would have devastating personal effects (including personal and corporate bankruptcy), predictably the franchisor's and CIBC's interests would be protected

Conclusion
I find it regrettable that CIBC has chosen to refuse to accept complaints in regards of this matter and deal in a good faith. It has come to our attention that the misuse of the federal small business loan program is common in franchising.

We would like to help reduce the risk of franchise relationships being used as a vehicle for increased white-collar crime in Ontario. The high cost of litigation and franchisor intimidation make Ontario franchisees defenseless.

Several stakeholders, with this lender only being an example, exploit this systemic problem. Current Ontario franchise policy actually increases the risk to small business investors.

Thank you again and I look forward to working with you.

Yours truly,

Mr. Andrei Oudovikine
Mr. Alexandre Oudovikine


Risks: Fraudulently inflated franchisee revenue figures, Liar Loans, Able to finance and sell negative cash flow franchise on crooked appraisals, Andrei Oudovikine, Appearance of government oversight, Arthur Wishart Act (Franchise Disclosure), 2000, Canada, Asset-based lending, Auditor General of Canada, Bad faith and unfair dealings, Bank Act, Canada, Bank violates federal privacy laws, Bank complaint process protects those who pay their salaries, Bank pays franchisor with franchisee's funds, Bank refuses to provide mandatory documents, Bank violates federal privacy laws, Bank won't finance deal because they know something you don't, Bankruptcy, Bankruptcy, first the company and then you personally, Banks, Banks allegedly mastermind fraud, Banks are industry cheerleaders, Banks collude, Blocking for the industry, Canada: white-collar crime haven, Canada: An unwise place to invest, Canada Revenue Agency, Canada Small Business Financing Act, Canada Small Business Financing program, Canadian Alliance of Franchise Operators, CAFO, Canadian Franchise Association, CFA, Canadian Imperial Bank of Commerce, CIBC, Code of ethics, a joke, Code of ethics, almost never enforced, Coerced waiver of legal rights, self, Collaborators, Complaint letter to franchisors trade association, Conspiracy to commit fraud, Conspiracy to hide the true nature of events in order to avoid detection, Controlling, trapping or defeating the franchisee, Credence good fraudulent expert, Credence goods: taking advantage of the innocents, Credibility, Criminal charges, Debt traps, Deceptive business practices, Earnings claim made, Externalities: cheap business decision when someone else pays, Financial Consumer Agency of Canada, Franchise banker, Franchise business model perfectly suited to enable massive fraud, Franchisee leader, Franchising is the most lucrative form of commercial lending, Franchising Opportunism paper, Franchisor financing: faster in, out & resold (serial bankrupts), Franchisor knew they were selling money losing concepts, FranWhack: a system that is not investment-worthy, Fraud, Fraud financed by rigged appraisals used equipment & leaseholds, Fraudster banker, Fraudster broker, Fraudster franchisor, Futility of taking legal action, Government guaranteed loan approved extremely quickly, Government guaranteed loan filled out by sales agent, Government guaranteed loan made without proper security, Government guaranteed loan misapplied, Government guaranteed loan program very attractive to fraud, Government guaranteed loans, Government guaranteed loans used a great deal in franchising, Government guaranteed loans: program loses $1, franchisee families lose $10, Government inquiries into franchise abuse allegations, Government investigation, Government inquiries into franchise abuse allegations, Ideas once outrageous are now considered normal, Illusion of government oversight, Imbalance of information and power, Immigrants as prey, Incompetent or predatory: for the small business investor, the outcome is the same, Industry Canada, Industry in disrepute, Industry elites like this regulator, Knew or could have reasonably been expected to know, Lender's due diligence not done properly, Lending duty, Lending duty never enforced via regulation or litigation, Lending is subject to expert fraud because it is a credence good service, Lending risk much lower, Les Stewart, Loan pushing, Loan servicers and brokers attracts fraud, Minister of Finance, Canada, Ministry of Government and Consumer Services, Ontario, Misrepresentations, Money laundering, Most lucrative form of commercial lending, franchising, Multi-tradename franchisors are often the most ruthless, Liar loans, Office of the Superintendent of Financial Institutions, Canada, Ombudsman for Banking Services and Investments, Canada, Ombudsman, franchisee must sign gag order 1st, Ombudsman, funded by franchisors & suppliers, Ombudsman, risk of information going to franchisor, On Cooling the Mark Out (Erving Goffman), Only saw bank official once before loan granted, Opportunism (self-interest with deceit), Police intervention, Predatory actions, Predatory franchise lending, Predatory lending, Privacy breaches a prerequisite for fraud, Privacy Commissioner of Canada, Refuses to accept complaint, Refuses to investigate complaints, Regulator already has enough power but they don't use it, Retaliation, Right to associate, Right to associate and right to harass, Royal Canadian Mounted Police, RCMP, Sales agent shenanigans, Shame - humiliation emotion, Sincerity, Some of the nastiest predators run several tradename systems, Sunshine is the best disinfectant, Symbiotic relationships (industry, banks, lawyers), Taxpayers end up paying for private gain, Termination threats, The game is rigged, The Toronto Star, Threats of physical violence, Theft, Tony Martin, Towers of gold, feet of clay, Trap for the trusting, U.S. subprime mortgage scandal, Unauthorized funds transfer by bank, Undue influence, War of attrition, Watchdog fails to bark, Willful blindness, Write a letter of complaint, Canada, 20050701 Narrative RCMP

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