Telemarketer sued over loan guarantee to Anne Squires firm

A Montreal businessman once accused by federal regulators of running a $60-million deceptive telemarketing operation is now being sued over a loanguaranteehe allegedly provided to a numberedcompany with links to Anne Squires ofExit Realty on the Rock.

The Bank of Montreal filed the lawsuit against Shawn Frank at Newfoundland and Labrador Supreme Courtearlier this month the same day it launched two actions against Squires.

CBC News revealed in February that Frank and his two brothers were the founding directors of Exit Realty on the Rock when it was launched in 2004.

• CBC INVESTIGATES | Montreal telemarketers once accused in $60M 'scams' helped launch Exit Realty on the Rock

Shawn Frank signed the fledgling firm's first application for a realestate licence back in November 2004.

The Montreal businessmen were retroactively delisted as directors of Exit Realty on the Rock after federal agents raided their Infotel call centre in St. John's weeks later.

Six years later, in 2010, the federal Competition Bureau charged the Frank brothers for an alleged role in "deceptive telemarketing activities related to business directory scams" resulting in estimated revenues of $60 million between 1999 and 2004.

But a series of court delays led a Quebec judge to stay the charges in 2013. The case never went to trial.

ShawnFrank did not respond to CBC News messages two months ago about his role in the founding of Exit Realty on the Rock, or an inquiry this week about the pending lawsuit.

Frank owes $119K, bank alleges

Court documents filed by the Bank of Montreal on April 14 suggest there is a financial link between Shawn Frank and Anne Squires today.

The bank alleges in its statement of claim that Frank guaranteed up to $400,000 of the debts of a numbered company, 71353 Newfoundland and Labrador Inc.

The Bank of Montreal alleges that he is on the hook for $119,400, plus costs, related to an unpaid debt owed by 71353.

The bank says it asked Frank for the cash on Feb. 17, but hasn't been paid the outstanding amount.

None of those claims have been proven in court, and Frank has yet to file a statement of defence.

Guaranteed debts

In a separate court proceeding,the bank claims that numbered company, 71353, guaranteed debts of Exit Realty on the Rock.

In October, the bank claims itwrote 71353, Exit Realty on the Rock and Squires,calling in a loan of more than $268,000 owed by the Squires-owned Exit franchise.

Four months later, in February, the Bank of Montreal pushed Exit Realty on the Rock into receivership after the Newfoundland and Labrador governmentsuspended the firm's real-estate licence.

Those receivership proceedings are ongoing.

• Bank of Montreal sues Anne Squires over loan guarantees
• Unsecured creditors 'unlikely' to see cash from Exit Realty on the Rock receivership
• New issues arise related to Exit Realty on the Rock trust fund accounts

Separate from that process, the Bank of Montreal recently sued Squires personally over debts incurred by Exit Realty on the Rock and 71353.

The same day the bank filed those actions, it also sued Shawn Frank over money loaned to 71353.

However, there is no evidence in the court file that debt owedto the bank by 71353is the same debt owed to the bank by Exit Realty on the Rock.

Squires director of both companies

According to corporate registries, Squires is the sole director of Exit Realty on the Rock.

Squires and Frank's wife Elisa Fremeth are the two directors of 71353.

And there are more financial ties between Frank and that numbered company.

According to records obtained by CBC News, a Quebec company linked to Frank registered a security interest against 71353 for "all rights, benefits and monies due under contracts with Exit Realty Corp. International."

That document was filed two days before Christmas.

Squires facing 6 civil suits

Squires has not spoken publicly since Feb. 6 two days after her company's licence suspension was announced. She read a brief statement to the media at that time, but did not take questions.

A half dozen lawsuits have been launched against Squires in the two-plus months since the collapse of Exit Realty on the Rock. Those civil actions, combined, seek well in excess of $1 million.

The Royal Newfoundland Constabulary executed a search warrant at Exit Realty on the Rock's head office in St. John's two months ago.

According to court documents filed by the police, Squires is under criminal investigation for theft, fraud and breach of trust.

She is not facing any charges.