A single investor has agreed to provide $600,000 to the receiver dealing with Victoria mortgage broker Greg Martel’s bankruptcy to help win the right to sell a Las Vegas property in the hopes of bringing in $1.8 million for investors.
Receiver PricewaterhouseCoopers is continuing efforts to recover missing millions for a group of 1,200 investors.
Investors put $226 million into short-term bridge loans for real estate deals. Those loans were promoted as high-interest earners but it is unclear where the money went and many investors say they have been waiting for months for re-payment.
It is not known where Martel, owner of My Mortgage Auction Corp. and other companies, is living.
Names of borrowers, their addresses, and the amount of loans have not been provided to the receiver, who has only been able to find $302,000 so far.
The identity of the funding investor was not released in PricewaterhouseCoopers statement. The new funding followed the receiver’s plea to investors last month for money to continue its work. PricewaterhouseCoopers needs money to pay for U.S. court applications requesting recognition of Canadian court orders freezing Martel’s assets.
One of the assets is a property in Las Vegas which the receiver believes could bring in $1.8 million for investors.
The receiver said it has to act quickly to get control of and sell the property.
The new agreed-upon funding is crucial to the receiver’s efforts to win control of the Las Vegas property because a group of five Martel investors have already started legal action in Nevada which could lead to the sale and seizure of the property.
Inspectors for the bankruptcy estate of Martel’s My Mortgage Auction have endorsed the funding agreement. It now must go before the court in B.C. for approval, likely early next month.
“Having this funding in place will facilitate the recovery of the value in the Las Vegas Property owned by Mr. Martel,” the receiver’s statement said.
A critical step in winning control over the property is obtaining a bankruptcy order against Martel in court, the receiver said. A hearing is set for Aug. 31, the receiver said.
If approved, the receiver will hire legal counsel in the U.S. to seek the orders it needs for the Las Vegas property. The new money will go towards dealing with ongoing court applications from Martel, the receiver said.
These applications have obstructed the receiver’s efforts to collect useful information from Martel regarding the bridge loans and other matters.
The money will also go towards other recovery initiatives the receiver wants to pursue. No details were immediately provided.
But the receiver said funding agreement details will be contained in its next report.
After the court approves the funding agreement, the receiver plans to return monies forwarded by a few investors who have funded the Las Vegas efforts to date.
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