An Ontario court has approved a final payment to clients of Portus Alternative Asset Management Inc., which will see the collapsed hedge fund's customers receive at least 95 cents on the dollar of their investments as the recovery process now winds down.
Mr. Justice Colin Campbell of the Ontario Superior Court yesterday approved a fourth distribution to Portus customers worth 3.14 cents of each dollar they invested in the fund, boosting their recoveries to 95.14 per cent of their investments so far.
The final payment approved yesterday means the long-running receivership of Portus is drawing toward a close, with the receiver KPMG Inc. preparing to end its work after almost five years of efforts to recover clients' funds.
Portus was shut down by the Ontario Securities Commission in 2005 amid concerns that the firm's money was not being invested as promised, leaving 26,000 investors worried about the fate of more than $800-million in investments.
Lawyer James Grout, who represents KMPG, said some customers will have recovered more than 99 cents of each dollar invested if they also qualified to receive repayment of their fees from brokerage firms under a regulatory settlement agreement by firms to compensate clients who were steered to Portus products.
Mr. Grout said there are still several claims outstanding that could help to recover more funds for investors, but there is no certainty they will bear fruit.
For example, the receiver is attempting to collect money from the fund's founder, Boaz Manor, who is facing criminal charges for his role with the investment firm. The receiver has attempted unsuccessfully so far to recover $8.8-million (U.S.) worth of diamonds it alleges Mr. Manor moved to Israel when he left Canada after Portus's collapse. The receiver also wants Mr. Manor to return $3.1-million (Canadian) in cash it alleges is still missing.
There is also a $2.8-million (U.S.) claim still outstanding against Mr. Manor's former lawyer, Anthony Malcolm, as well as a claim against a trust in the Bahamas that holds $1.2-million.
Mr. Grout said the Portus bankruptcy file will remain open, even as the receivership is wound down, just in case more money is recovered from any of the remaining actions in the future.
Mr. Grout also told the court yesterday there are 50 Portus clients who did not come forward to collect their payouts from the receiver and cannot be located. Their accounts total less than $400,000.