Niagara financier's big money propositions leave entrepreneurs with ruined dreams

A dozen Ontario entrepreneurs trickled in to a Jack Astor's in St. Catharines one busy Saturday night in February.

Some came alone; some knew each other. Some wore red, as they'd discussed online as a way to find each other.

They hadn't counted on there being so manypeople in red cheering Canada as they watched the Olympics, but in time, thebusiness owners found each other and began to sharetheir stories.

They had a common denominator they'd all trusted the same Niagarafinancier, Peter Corbire, to help them realize their business dreams.

And they all were angry.

In hindsight maybe we should have seen it. But he presents himself as credible enough.- Ty Shattuck, aerial drone entrepreneur

They compared notes about the money stretching into the tens of thousands of dollars each they'd given Corbire based on his offers to provide the loans they needed to grow their businesses.

Some hadn't realized there were others in the same boat. That night, they found solidarity and support and discussed their options.

Veteran Burlington, Ont., businessman Ty Shattuck was one of the ones wearing red that night. Hesaid Corbire got past even skeptical investment bankers on his team.

"He did a good job, right? In terms of pulling the wool over our eyes," Shattuck said. "In hindsight maybe we should have seen it. But he presents himself as credible enough."

7,000 text messages

In 2015, Karl Hollettwas primed for a major expansion of his solar panel business in Napanee, east of Belleville, Ont., and signed adeal with Corbire for due diligence on a $3.6 million loan Corbireoffered.

Corbire said he just needed a lender's fee of $47,460. Hollett sent him the fee the first of a few transfers he'd make as Corbire's assurances that the funding was coming grew.

But the money never came.Hollett'scompany has gone bankrupt. He's putting together paperwork to sue.

As months wore on, Corbirereassured him oftenthat the loan was on its way, Hollett said. Itnever materialized.

"He continued to lead us down the garden path," he said.

Hollett kept all his 7,000-plus text messages with Corbire. He saidCorbire has sent him 88 different texts suggestingCorbirewas at the bank, sending him the loan money.

"In hindsight, we can always look back and say, 'You know what? I was a fool,'" he said. "But I didn't think I was.

"I felt this guy had some issues he was dealing with at home," he said. "I had to cut him some slack. But I guess I cut him too much."

After they cut a cheque, something always comes up

Hollett's experience with Corbiere mirrors that of a number of entrepreneurs CBC News has interviewed.

To entrepreneurs eager for cash, he's proposedhuge loansin exchange for a lender's fee sent directly to him, his "Snow Angels Management Services Inc." or his numbered company.

Many are on the cusp of rapid growth, and the financingis the key to unlock it.

Don Nott,a 71-year-old farmer in Clinton, Ont., says he paidCorbirea fee of$38,000 for a loan two years ago. Nottwas looking for financial help to convert his farm operations into a recycling company for hay bale plastic. The loan money never came through, andCorbire's promise of a refunded deposit in such a case has gone unfulfilled.

Farmer Don Nott: 'I realize ... I've been duped'

7 years ago

Duration 0:44

Don Nott tells the CBC's Stephanie Matteis about the $38,000 he gave Peter Corbire in exchange for a loan to grow his agriculture waste-recycling business.

After the entrepreneurslike Nottcut Corbire a cheque, something always comes up.

They call him; he says their money is imminent. Eventually they give up on seeingthe funds as the business opportunity passes. They start to work onat leastgetting their deposits refunded.

Even as their faith wanes,they still text him and he almost always texts them back.Mosthave been waiting months, even years, without seeing their money back.

A financing expert who owned the room

Corbire presents himself as a veteran business financing expert. To the entrepreneurs he's signed deals with, he seems to know exactly what he's talking about, no matter the industry at hand.

For several years he worked as a senior partner of consulting at the government bank set up to help small businesses the Business Development Bank of Canada (BDC).

He has spoken at economic development events in Niagara and Norfolk County. He's been quoted in the Toronto Star.

Corbire told CBChe was fired in 2014 from theBDC.

The BDC says it doesn't comment on current or former employees, nor does it address situations regarding specific clients.

But the bank quietly tried to clean up a messhe'd left, according to court documents.

And the trail of broken dreams and frustrationin Corbire's wake continues.

CBC News has learned at least ninesmall business owners in Ontario and the U.S. have given more than $650,000 to Corbirein exchange for investment loans or deals.

Lawsuits and interviews show that the money never materialized, and most didn't get a cent of their money back.

And for several years, he's been proposing these dealswhile his personal finances crumble. Court documents show that since 2015, two credit cards and two mortgages on Corbire's Niagara-on-the-Lake house have gone into default when he failed to make payments.

Despite making several appointments to speak with CBC News for this story,Corbireultimately sent an email last Friday sayingthere are many reasons why companies do not get funding, or why funding is delayed or "actually collapses during the process."

Just because somebodydoesn't get fundingdoesn't mean that they were ripped off.- PeterCorbire

Corbiresaid there were "several ongoing issues" that kept theHolletts' deal from going through. He declined to comment on the specific allegations the other owners raised, citing client confidentiality.

Corbiretold CBC News in an interview last summer he's never refused to refund anyone.

"Just because somebody doesn't get funding doesn't mean that they were ripped off," he said."It means there's a reason that they're not getting their funding."

But the business owners say he never communicated that to them, leaving them waiting for the money he'd said was imminent.

Businesses who trusted Corbire

Meanwhile, some business owners have taken Corbire to court.

Just last month, a Toronto court awarded aMaryland logging company $89,389.01Cdnplus another $8,000-plus in legal costs on their claim againstCorbireand his partners.

The company transferred him$57,500 USas a fee deposit fora $5.75 million loan in 2016, according to thelawsuit.

Corbiredidn't do the due diligence, the loan never came through, and though he didn't dispute that Corbireowed the company a refund, the refund never came.

At the other end of the equation, aNiagara Falls investor transferred $250,000 toCorbireas investment capital for his "business ventures"in 2015 after being "impressed byCorbireand hisbusiness acumen," according to another lawsuit filed last year.

The investor allegesCorbireexecuteda promissory note that he would pay back the money with 10% interest, but there was never any money paid back.

Other business owners who have struckdeals with Corbireinclude:

• Shattuck, an aerial drone entrepreneur in Burlington, who says he's owed nearly $15,000 after a $7 million loannever came through.
• A blow mold factory in Hamilton saiditpaidCorbire$169,500 for a fee to Corbire; the company alleges in a lawsuit he didn't come through on what he'd promised.
• A farmer in Clinton says he paid Corbire $38,000 in 2016, didn't get his loan and hasn't been paid back his deposit.
• A voice recognition software company in St. Catharines filed a small claims suit for $7,500 the company paid Corbireon the side while he was at the BDC. The company wasn't paid back for at least three years when he didn't find them the promised investors, it alleges in thelawsuit, which was resolved before the matter could be heard in court.
• A construction contractor in Grimsby gave $10,000 to Corbire on the side to arrange a loan while Corbire worked for BDC. BDC ended up refunding him the deposit when Corbire didn't.
• Hollett's solar panel company in Napanee has transferred more than $70,000 in fees to Corbire for loans that never materialized. Now the company is bankrupt, and they blame Corbire.
• Just in January, owners of a pasta sauce company in Niagara Falls gave Corbire$6,500 as a fee fora $150,000 loanhe told them he could easily arrange. The loan never came through, and two of Corbire's cheques bounced when he said he'd get them a refund.

In many cases, the business owners signed paperwork with Corbireoutlining the terms timelines, interest rates and payback policies of the loan he proposed for them.

Many said he appeared confident and reassured them the funding was imminent, that there would be no issue getting them the thousands or millions they needed within days, in some cases.

But in the documents CBC has reviewed,Corbireoften noted the deal was conditional on "due diligence." If that business research wasn't satisfactory, or if the loan didn't come through,Corbirepledged to refund the fees.

But the business owners say getting those refunds is impossible and many say he never told them there were any issues with the due diligence. Some wonder if he did any research at all.

Corbieresaid "refunds generally consider the reasons, time and effort" in an email to CBC News.

Why a business expert says the deals might seem attractive

Franois Neville, assistant professor at McMaster University's DeGroote School of Business, said small business owners whoneed money to help them grow or take on a bigger contract that will take their business to the next leveloften look too risky to traditional banks.

But they're too small to go to venture capitalists looking to sink millions into a project.

"I can see how it would be attractive for a small business owner or an entrepreneur because people are very hesitant to give up any equity in their business because they're afraid to lose control," Neville said.

People are very hesitant to give up any equity in their business because they're afraid to lose control.- FranoisNeville, assistant professor atMcMasterUniversity'sDeGrooteSchool of Business

In an interview last July, Corbire said he had arranged financing for more than 100 companies successfully. CBCasked for names ofsome or all of those businesses. To date, he has not provided any.

In an email, he said 10 to 15 per cent of companies that start "the process" with him for funding "end up in failure due to a variety of reasons."

A deal on the side, to a numbered company

In 2013,Matthew Della Valle, a construction contractor in Grimsby,was about to take on the most ambitious projects of his career. His company,NuFusion, wasto become the exclusive contractor for World Gym Canada.

As a client of the BDC, Della Valle was assigned to Corbire's portfolio. He trusted him when Corbire said he could line up the $1.5 million in financing Della Valle needed to take on the projects, according to a lawsuit Della Vallefiled.

But Corbiretold Della Valle to make out his cheque for the $10,000 fee to a numbered company, one that Della Valle later learned was registered toCorbire's wife. Then,Corbire never arranged the loan or paid Della Valle the $10,000 back, DellaVallealleges.

Now, nearly five years later, Della Valle's business has crumbled. He's laid off all of his workers. He's suing the BDC, arguing the government corporation should have protected him.

And he's livid to hear stories like the ones shared at Jack Astor'sfrom others who made deals withCorbire.

"It's brutal. It's unbelievable," he said. "I know some of these people, they've got families and stuff. It's just I get emotional. You expect this money, you're telling your staff. It's terrible."

You expect this money, you're telling your staff. It's terrible.- Matthew Della Valle, owner of NuFusion construction contractor

If the BDC had been public about Corbire's departure in 2014, Della Valle said, perhaps that might have given other businesses a warning.

Corbire told CBCthe BDC fired him shortly after Della Valle complained. He said his termination was for a"breach of employee conduct." ButCorbire said BDC management knew everything hewas doing.

Della Valle is suing BDC for breach of contract and negligent misrepresentation, saying the BDC should know that Della Valle would rely on Corbire's word for what the agency could offer.

Ultimately, the BDC paid Della Valle back the $10,000 he'd paid to Corbire, the corporation admits in its defence filed in court. But it also notes that action was done "without any admission of liability or wrongdoing."

The BDC says if Della Valle didn't have the money in hand, his company took on contracts"at its own peril and without any fault or responsibility of BDC."

A court date on Della Valle's lawsuithas not yet been scheduled.

A veteran business owner caught up

Shattuck said he's frustrated to be among the entrepreneurs who trusted Corbire after he left the BDC.

"I'm not an expert financier, but I'm not a complete newbie; you know, I've raised capital in the past," Shattuck said. "It's embarrassing to get caught up in one of these things."

Shattuck says Corbire still owes him nearly $15,000 from a deposit he put down to obtaina $7 million loan Corbire said he could provide him. Shattuck owned a company making aerial sensors for drones and helicopters, and was trying to buy an American company.

Shattucksaid Corbire kept telling him that a loan agreement was imminent, and the funding,but noneever came.

"He just couldn't close; there was always some issue," he said. "Every time you'd be like, 'Peter, what's going on?' you'd get some sort of story," Shattuck said.

Texts from Corbire continue

For those business owners who trusted Corbire,they've lost bothopportunity and money. The dreams are gone.

But Corbire continues to send text messages, saying he's working on giving their deposits back or has a new idea on how he can help.

Nott, the farmer in Clinton, Ont., says he has a cheque from Corbirefor the full $38,000, but everytimeCorbiretold him he could cash it, the bank said there were insufficient funds.

Don Nott: 'He wanted money for his own needs, whatever those needs were.'

7 years ago

Duration 2:29

CBC News has found eight other business people with stories similar to Don Nott's, who trusted Peter Corbire.

"He told us story after story you should just see the list of texts," he said. "I've been in contact with that man once or twice a week, every week, for the last two years almost."

Karl Hollett, the solar energy entrepreneur, has gone bankrupt. He saidCorbirenever brings up the refunds he owes them, but keeps texting with ideas of how he can help them save their house.

"The long and short of it is (if) Peter had come through on the things we were told weren't even questionable, we wouldn't be here right now," Hollett said.

ShattucksaysCorbiretexted a couple of weeks ago, to say he was "leveraging some assets" to getShattuckhis money back.

"It's exactly the same stuff he's been saying for a year-and-a-half now," he said.

kelly.bennett@cbc.ca