Ex-broker faces third lawsuit
White Rock investor alleges Peter Miles and CIBC Wood
Gundy mishandled her account.
David Baines, Sun Business Reporter Vancouver Sun
A third lawsuit has been filed against former CIBC Wood Gundy
stockbroker Peter Miles, who got into hot water after recommending
stock promoted by soon-to-be tabloid star Beverlee Kamerling.
Patricia Wotherspoon of White Rock alleges in documents filed in B.C.
Supreme Court that Miles and his firm mishandled her account from 1991
to this year.
She claims the defendants entered into transactions without her knowledge
or consent, invested in unsuitable and undesirable investments, and
"churned" her account.
(Churning is buying and selling securities to earn brokerage commissions,
rather than to benefit the client.)
Although not mentioned in the claim, one of the stocks that Miles
recommended to Wotherspoon was International Indigo, a Seattle-based
company promoted by Kamerling.
Kamerling, who has an extensive regulatory record, was featured last
week on the Oprah Winfrey show after she bought more than $31,000 US
worth of Marilyn Monroe memorabilia and gave one of the items to a
wheelchair-bound woman.
While Oprah's audience was touched by her generosity, the U.S.
Securities and Exchange Commission was not. Kamerling still owes the
commission $1.5 million US arising from a settlement over another U.S.
stock scam, United Fire Technology.
After the show aired, the Star -- one of America's largest tabloids -- heard
about Kamerling's appearance and is currently preparing a story that is
scheduled to appear in supermarkets later this week.
Assisting Kamerling in both the International Indigo and United Fire
Technology promotions was West Vancouver promoter Nik Markovina.
Markovina was also a client of Miles. In at least one instance, Miles sold
Indigo shares directly from Markovina's account at CIBC Wood Gundy to
the account of another client to whom he had recommended the stock.
Miles later admitted that he had received at least two paintings from
Markovina and hung them on his living room walls. Markovina acquired
the paintings from Kamerling, who claimed they were worth hundreds of
thousands of dollars.
Miles said the paintings were "very ugly" and insisted there was no
connection between his recommendation of Indigo stock and his receipt of
the paintings.
In her lawsuit against Miles and CIBC Wood Gundy, Wotherspoon
alleges the defendants failed to disclose "the benefit received by one or
more of the defendants" as a result of his stock recommendations.
She asserts that, if CIBC Wood Gundy is not directly culpable, it is
vicariously responsible for the actions of its employee. She claims
damages, restitution, interest and costs.
Miles worked as a broker for 16 years, the last eight with CIBC Wood
Gundy. On July 26, his registration was terminated. The brokerage firm
declined to say why.
Wotherspoon's lawsuit was filed by lawyer Craig Dennis of Sugden
McFee & Roos, who filed an almost-identical lawsuit against Miles and
CIBC Wood Gundy on behalf of Teresa Barkwell of Richmond on Oct.
15.
In an interview Monday, Barkwell said she first complained about Miles'
conduct to the Investment Dealers Association of Canada in the spring of
1994, but was advised to try to resolve the matter with CIBC Wood
Gundy.
When that failed, she sent a written complaint to the IDA in July 1997.
She said the IDA initially dragged its heels, but "appears to be taking the
matter more seriously now."
Meanwhile, in October 1998, a West Vancouver businessman filed a
lawsuit against Miles and CIBC Wood Gundy for allegedly mishandling his
account. The status of that case is not known. |
