Global Courant 2023-04-20 06:48:15
A BC Securities Commission (BCSC) panel has fined a $1.6 million BC man who defrauded an investor by claiming to own the legendary Sooke Harbor House resort hotel.
Timothy Craig Durkin has been embroiled in a years-long dispute with the original owners of the hotel, which has hosted Hollywood stars and royalty for more than 40 years in Sooke, a tourist hot spot on the southern tip of Vancouver Island, about 25 miles southwest of Victoria.
In January, the commission found that Durkin raised $1 million from an investor between December 2015 and March 2016, promising the investor a 40 percent stake in the hotel by buying 40 percent of the shares in the company SHH Holdings, where Durkin a director.
“In reality, at that time, SHH did not own any of the shares in the company that owned the hotel,” a statement from the BCSC reads.
“The BCSC panel concluded that on three occasions SHH and Durkin made false statements regarding hotel ownership, knowing that they would be perceived as an accurate representation of the current financial situation.”
Now Durkin has been fined $1.6 million, including the $1 million obtained by the fraudulent scheme.
However, the $1 million fine could be reduced if Durkin pays the investor after a separate civil suit, the outcome of which is still pending.
In 2020, IAG Enterprises of North Vancouver purchased the land surrounding the Sooke Harbor House building and associated assets in a court-ordered foreclosure sale for $5.62 million.
The hotel is closed for renovations and no reopening date has been set, a statement said on its website. Neither Durkin, his companies nor the original owners are involved with the property anymore.
The internationally renowned Sooke Harbor House resort hotel has hosted film royalty and dignitaries. The company was the subject of an ownership battle for half a decade. (Michael McArthur/CBC)
$1 million spent and not recovered
A Vancouver Island resident, Durkin had a six-year legal battle starting in 2014 over ownership of the renowned resort hotel.
In 2020, a judge sided with original owners Frederique and Sinclair Philip and awarded them $4 million in their battle to wrest control of the hotel from Durkin and his partner Rodger Gregory.
In a damning decision, the judge described Durkin as a “garden-variety bully” who is “entirely unfettered by ordinary standards of morality, integrity and decency”, noting that Durkin had sworn a false statement to obtain a warrant to the Philips away from the hotel.
The BCSC’s latest punishment relates to Durkin’s association with an unnamed investor, a Chinese national who wanted to emigrate to Canada at the time. She had already invested in a spa in the Sooke area and was considering expanding her investments in the region through the $1 million hotel deal.
According to the ruling, Durkin, a director of SHH Holdings, argued that the investor had not been misled and did not intend to mislead it. The $1 million in funds has been spent and has not been recovered by the investor or her company.
However, the BCSC panel found that the BC man made false statements in writing, including a 2015 email claiming that SHH Holdings “owns 100 percent of the outstanding and issued share capital of Sooke Harbor House Inc.”
The panel also permanently banned Durkin from any activity in BC’s investment sector.
“Only a broad multi-decade ban will provide the public with a meaningful level of protection,” the commission’s statement read.
