A former Vancouver Canucks defenceman is suing his financial advisers, alleging they gave him negligent advice for the purpose of personal profit.
The suit claims financial adviser Richard Jones sold Jason Garrison a series of unsuitable investment vehicles and insurance policies, which ended up costing him more than the sum of his US$27.6 million, six-year NHL contract.
“Mr. Jones misrepresented that as a result of his recommendations, the plaintiff would have $43.5 million in capital at the end of 10 years,” alleges a notice of civil claim filed in B.C. Supreme Court in October.
“In fact Mr. Jones over sold investment products to the plaintiff causing financial loss.”
Garrison, then 28, signed the deal with the Canucks in 2013, the same year he hired Jones and his agency, states the suit.
According to the notice of claim, Garrison had “limited experience with financial matters, investments, life insurance and no experience with financial planning.”
It claims Garrison told Jones that he knew his career could end at the end of his contract, and he would need to live off his savings long term.
The suit claims that over three years, Jones sold Garrison a series of investment vehicles, including three $10-million life insurance policies, as a part of a complex and high-risk investment strategy.
However, it alleges that Jones misrepresented critical details about those policies, including commissions and management fees and the fact the investment strategy was under review by the Canada Revenue Agency with an eye to eliminating it as a tax loophole.
“The defendants promoted the sales of insurance policies as a part of a sophisticated tax advantage investment strategy, yet the defendants had knowledge that the strategy was under review, and there was an intention by the federal government to reject the strategy,” the suit alleges.
The suit claims that Garrison was also not made aware of the full costs of the policies, nor was he advised to seek independent tax advice.
It further claims Jones failed to undertake a needs analysis or financial plan, which would have revealed Garrison didn’t need and couldn’t afford the insurance contracts.
It also claims that Jones copied Garrison’s signature onto some documents and modified other documents after Garrison had signed them.
“The dominant purpose for which the defendants sold the policies and the leverage loans to the plaintiff was to earn profit, premium, commission and other compensation, without regard to what was suitable for the plaintiff,” the suit claims.
In an email, Rick Jones said he only became aware of the suit on Tuesday night and he was still preparing his response.
Jones has yet to file a response to the suit, and none of the allegations have been proven in court.
The suit also names several insurance companies, which it alleges failed in their due diligence by allowing the investments to go forward.
Garrison is seeking reimbursement of interest and other charges paid on leveraged loans he took out, the voiding of all insurance contracts sold to him, along with a return of the premiums he paid.
It is also asking for an accounting of all sums paid to Jones and the other defendants along with a disgorgement of any commissions paid out, along with unspecified damages.
Garrison was born and raised in White Rock, B.C.
The Canucks traded him to the Tampa Bay Lightning in June 2014, after which he had stints with the Vegas Golden Knights and Edmonton Oilers.
He currently plays for Djurgårdens IF in the Swedish Hockey League.
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