The British Columbia Securities Commission (BCSC) is alleging that the developers behind Vancouver Island's largest real-estate project, Capital City Centre in Victoria, promoted securities without proper disclosure.
The BCSC announced August 14 that it has issued a notice of hearing alleging that League Investment Services Inc. promoted the sale of units of IGW Real Estate Investment Trust (REIT) without disclosing that League's owners earn management fees from the sale of those securities and that they are also trustees of the REIT.
Adam Gant and Emanuel Arruda, through family trusts, own League and are its sole directors, according to the BCSC. The two B.C. residents are also trustees of IGW REIT and Gant is the president of IGW REIT.
The BCSC contends that failing to disclose Gant and Arruda's connection with the REIT broke securities laws.
None of the allegations has been proven in court.
Gant, in an interview, called the allegations "strange."
"All of those investors that participate with us are all doing so completely aware we are offering investment, and then, through League Assets Group, managing those entities," Gant told the Victoria Times Colonist.
IGW has not yet gone public but was intending to have an IPO under the name League Financial Services.
League is financing Capital City Centre in the Victoria suburb of Colwood. The mixed-use residential, commercial and office project is expected to be worth $1 billion and has been plagued with delays.
The 14-acre, multi-phase project is slated at completion to have 4.3 million square feet in 11 buildings, including two 26-storey towers that would be Vancouver Island's tallest.
Completion of the initial buildings is set for December but the entire first phase is expected to take six years.
