A bit of ignoble legal history is being made on Salt Spring Island — and a pair of property owners have found themselves in the news again, as another of their properties is suspected of having been purchased with ill-gotten gains.
For the first time since passing legislation permitting it — and in a first for Canada — B.C.’s provincial government has filed an application to secure something called an unexplained wealth order, a newly created tool under the Civil Forfeiture Act that — when a judge approves — requires people to explain how they acquired particular funds when there are suspicions it came from criminal activity.
Minister of Public Safety and Solicitor General Mike Farnworth declined comment regarding the specific case on Salt Spring, at least while the matter remained before the court.
“However, I can confirm that we will continue to forfeit illegally obtained assets,” said Farnworth, “and redirect them to community safety and crime-prevention initiatives, which help repair the damage done by those who think that they can profit from crimes and illegal enterprises in British Columbia.”
The province newly alleges a home here at 435 Stewart Rd. was purchased in 2017 to launder money from a $200-million international stock fraud, involving listed property owner Alicia Valerie Davenport (formerly Lee) and co-defendant Geordie “Skye” Lee. The couple, along with then-co-defendant Vincent Manalastas, were earlier targets of a 2019 B.C. Civil Forfeiture Office lawsuit, alleging another property — on the water at 391 Baker Rd.— was acquired through a similar criminal effort.
B.C. property records show the Stewart Road home was purchased by Davenport, without a registered mortgage, for $1 million; back in 2014, Davenport and Lee bought their Baker Road home for $1.2 million and, according to the province, undertook more than half a million dollars in renovations — again, without a mortgage, and during a period the province alleges the two were part of a broad criminal scheme to disguise ownership of publicly traded companies to circumvent securities laws.
An investigation by the United States Securities and Exchange Commission (SEC) in 2018 found that plot was responsible for $165 million (USD) in unlawful proceeds accrued between June 2015 and September 2018. The SEC investigation also found that Beresford Estates Inc. — the registered corporation owned by the co-defendants, used to register the Baker Road property’s title — was used in B.C. to receive and distribute proceeds of the securities fraud.
RCMP investigating that case in Canada subsequently found Lee and Davenport had contracted renovations to the Baker Road home amounting to $526,000, which were paid for through a series of allegedly suspicious wire transfers.
The Baker and Stewart Road properties are currently valued at $4.2 million and $1.8 million, respectively, according to B.C.’s assessment authority. On the 2017 form transferring ownership of the Stewart Road property, according to the province, Davenport listed her occupation as “home maker.”
“At all material times, any income lawfully obtained by A. Davenport and G. Lee was insufficient for the purpose of enabling the defendants to acquire or maintain the Stewart Road property,” alleges the lawsuit. “The property is proceeds and an instrument of unlawful activity.”
Davenport and Lee denied wrongdoing in the Baker Road lawsuit, which is still winding its way through the courts; at press time, they had not yet responded to the province’s latest allegations.
Farnworth said the action was the “first in a series” of unexplained wealth order applications that will be filed with B.C.’s Supreme Court, with a hearing date expected for Jan. 11, 2024.