Report finds millions in ‘unjustifiable’ spending by directors of insolvent real estate company

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Based on bank records and interviews with the people involved the business, the report alleges conflicts of interest, questionable capital controls and accounting, as well as personal spending with corporate funds by directors of the company

real estate empire in Ontario alleges a pattern of lavish personal spending and “a pervasive lack of proper record keeping” about how $144-million in loaned money was spent.rental investment business, known as Balboa Inc. et al. in court filings, that sought insolvency protection in January, after it accumulated 407 homes and rental properties across Northern Ontario beginning in 2019 financed with private mortgages that later fell into default.

Over 92 pages, it lays out expenses paid by the companies, including: $59,034 for luxury home rentals; $42,174 for private jet rentals; $38,500 for Instagram influencer messages; $25,000 in one night between a Miami Beach nightclub and separate strip club; $21,000 in a matter of days at luxury hotels in Paris and New York City; and even $4,700 sent by PayPal to a private chef named “CHEFRODRIGO.”

The report says it appears there was “a pattern of unjustifiable defalcation of funds” from investors, many of whom were private lenders. “Based upon the applicants’ preliminary review, it appears that the monitor has either not reviewed, misunderstood, and/or ignored certain of the applicants’ responses.”

 

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