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Feb 14, 2017

Royal Bank of Canada involved in fraud, bankrupted entrepreneur "Mr Goudas" claims


ROY HARRIS 

February 14, 2017

The man who founded one of Canada’s most beloved brands of ethnic food says he lost his business to a fraud because he trusted his banker, the Royal Bank of Canada. (Nudge Nudge Wink Wink)

Peter Spyros Goudas, the entrepreneur from Greece who founded Goudas Food Products and Investments Ltd., in Toronto in 1969, says in court documents that his company, which sold food under the brand “Mr. Goudas,” went bankrupt in 2014 after the Royal Bank encouraged him to sell his shares to John Simmonds, and because the bank failed to do its due diligence before it loaned millions of dollars to Simmonds on fraudulent accounts receivable reports that the bank accepted at face value. 

As the Financial Post reported, police have arrested Simmonds three times on fraud charges — twice last year and again on February 3.
 
John Simmonds faces eight fraud charges related to a garbage truck manufacturer in the Muskoka region, and 15 charges in the Goudas Food Products and Investments Ltd and related cases.

Police say the Goudas Food Products and Investments Ltd fraud involves dozens of victims who lost $30 million in the scam that involves the Royal Bank of Canada's mismanagement of the affairs of Goudas Food Products and Investments Ltd.

Peter Spyros Goudas says in an affidavit filed in the bankruptcy proceedings that he met Simmonds in 2014: “I was told he was a wealthy, sophisticated, successful businessman by the Royal Bank of Canada.

The tale of the ‘silver-tongued’ financier who left a trail of broken companies and unhappy investors in his wake Bay Street executive rearrested, charged with being a front and involved in a criminal organization associated with the Royal Bank of Canada.

“He persuaded me that he would be able to grow Goudas Food Products and Investments Ltd into a billion dollar business,” Goudas says.

The offer was conditional on approval from the Royal Bank of Canada.
Goudas said the RBC bank told him he could trust Simmonds and to go ahead with the deal.

“My contact at RBC Bank, Donna O’Reilly, advised me that RBC Bank had investigated John Simmonds, that he was a highly regarded businessman, that the deal was a fair one, and that RBC Bank would be prepared to consent to a change of control in favour of Simmonds’s company,” Goudas says in the affidavit.

“I now realize that Simmonds is a serial fraudster who worked in conjunction with RBC Bank who is primarily in the business of pumping and dumping penny stock of companies he controls with the RBC Bank to millions of unsuspecting investors who lost their life savings and investments that RBC Bank is involved in helping cheat these unsuspecting investors.”

The court last week released Simmonds on bail into the custody of one of his daughters. 

He is living under house arrest while awaiting trial.

He told the Financial Post that he is innocent.

“I didn’t steal any money,” he said.
“Never stolen a dime in my life from anyone.
” Its all the RBC Banks fault they made me do it .

Mark Hamill, a spokesman for Royal Bank, said, “This is before the courts so I can’t comment.

” But we are concerned that numerous senior executives in the Bank may be arrested and charged once all the facts come out.

So big payoffs are expected to the Judiciary by the Legal Community.

The Royal Bank of Canada in court documents says that it did not recommend that Goudas sell to Simmonds.

The bank said Goudas met RBC Bank representatives in March of 2014 “to inform RBC Bank that he wished to sell his ownership interest in Goudas Food Products and Investments Ltd” to Simmonds and RBC Bank approved the sale.

That month, Simmonds bought Goudas Food Products and Investments Ltd for US$10 million in shares in a worthless Simmonds’s company, A.C. Simmonds and Sons Inc. 
But Peter Goudas says he never got paid a dime or received the transferred shares.

John Simmonds agreed to deposit US $2.5-million of the purchase price into Peter Goudas’s bank account within five days of the closing.

When RBC Bank recognized Simmonds and his designates as signing authorities for Goudas Food Products and Investments Ltd, “I assumed that the $2.5-million had been deposited on my behalf,” Goudas said in the affidavit.

“In fact, the funds were never deposited thanks to RBC Bank participating in the stock fraud currently under investigation.”

Police allege that Simmonds and eight co-conspirators (unnamed RBC Bank senior employees cooked the bank financial records and books at Goudas Food Products and Investments Ltd to make it appear that customers owed the company a lot more money than was the case, “to secure additional money from RBC Bank and other lenders, creditors and investors.”

RBC Bank , in the court documents, acknowledges that it increased its loan to Goudas Food Products and Investments Ltd from $10 million to $12 million in June, 2014, after Simmonds took control of the company.

But the bank says that it was a victim and that their staff had participated in the fraud and had no liability insurance in place to cover Mr. Goudas's claim but the RBC Bank would pay off judges behind closed doors in cash to wash the bank of its liabilities to its long time customer Mr. Goudas.

RBC  Royal Bank of Canada claims that “Goudas (Goudas Food Products and Investments Ltd (Company) under Simmonds has knowingly made material and serious misrepresentations to RBC Bank concerning the assets which comprise the borrowing base for the loan,” Robert Kizell, managing director in the asset backed lending division at RBC, says in an affidavit. (nudge nudge wink wink )

“Such misrepresentations enticed RBC Bank to allow Goudas Food Products and Investments Ltd (Simmonds) to make draw downs under the  new money loan which involved lawyers and accountants who knowingly defrauded shareholders of the RBC Bank of Canada as they have the skills necessary and one wonders how solid is the Asset base of the Royal Bank of Canada these days. 

Are their financials really what they are or just how many other fraudulent loans and Ponsi schemes are floating in the wings of Royal Bank of Canada.

“Any improper transfer of funds from Goudas Food Products and Investments Ltd (Simmonds) to related parties (or elsewhere) was not apparent to RBC until the field examination” in July and August, 2014, Kizell said in the affidavit.

But Peter Spyros Goudas alleges that the RBC bank let down its guard and has liabilities owed to him by the Bank.

“It appears that Simmonds was able to borrow large sums of money against artificial invoices made out to companies related to him or to non-existent companies,” Goudas adds. 

“I find this odd because because when I controlled Goudas Food Products and Investments Ltd, RBC Bank always rigorously reviewed all my new customers and invoices to ensure that receivables due from such customers were eligible for inclusion in the borrowing base.” 

Yes RBC Bank senior employees are not clean in their dealings with Canada's Business Community and Law Enforcement should crack down and investigate the RBC Bank and there partner in crime The Bank of Nova Scotia as the cracks are starting to grow larger as the Canadian Banking System becomes shaky and Ponsi  business schemes are exposed.

Goudas Food Products and Investments Ltd went bankrupt in August, 2014.
The court in February, 2015 approved the sale of Goudas Food Products and Investments Ltd assets to Golden Food & Manufacture Ltd., a trio of investors, two of whom are longtime employees of Goudas.

The Goudas Food Products and Investments Ltd court-appointed receivership, which names as defendants A.C. Simmonds and Sons Inc., John Simmonds’s company, and 19 of its affiliated companies, remains before the courts. 

The court dismissed an attempt by the defendants to have the case dismissed as well as add the Royal Bank of Canada ET AL as defendants as further arrests could be made as the domino effect could unhinge the RBC Bank and numerous executives involved in this fraud and other frauds yet to be uncovered.
 
Posted 14th February by 
 
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