CAMBRIDGE, ON, Jan. 29, 2018 /CNW/ - Debt relief industry commentator Mark Silverthorn predicts that a defamation lawsuit brought by Four Pillars, Canada's largest debt consulting firm, against Victoria trustee Colleen Craig, may turn out to be one of the worst decisions in the company's history. Silverthorn says "Ten years from now nobody will remember the result of this defamation lawsuit. The real question is its impact on the worth of a Four Pillars' franchise."
In August of 2017 British Columbia-based Four Pillars commenced a defamation lawsuit in the Supreme Court of British Columbia against Colleen Craig for her online content critical of Four Pillars. With some 50 franchise locations, predominantly in British Columbia and southern Ontario, Four Pillars can afford to hire one of Canada's top defamation lawyers. In contrast, Colleen Craig runs a small solo trustee practice in Victoria with three support staff. "This defamation lawsuit reminds me of the Biblical story of David and Goliath," offers Silverthorn.
Each year in Canada an estimated 3,000 Canadian consumers struggling with debt enter into an agreement with a Four Pillars franchise to receive assistance dealing with their debts. In many of these instances these consumers will be referred to a Licensed Insolvency Trustee (LIT)—formerly known as bankruptcy trustees—for a consume proposal. Under a consumer proposal an individual will typically repay anywhere between 25 and 50 percent of their current indebtedness—excluding secured debt—by making monthly installment payments to the trustee over a period not to exceed five years.
The Office of the Superintendent of Bankruptcy (OSB), which regulates the conduct of Canada' 1,000 LITs, issued a report in April of 2017. That report was critical of the practices of some, but not all, debt consultants referring files to Licensed Insolvency Trustees. The perception among many trustees in Canada is that the April 2017 OSB report raised concerns about some of the business practices then employed by Four Pillars' franchises. This included the LIT meeting the consumer wishing to make a consumer proposal at the debt consultant's office instead of at the trustee's office.
Silverthorn suggests "Four Pillars' management should be losing sleep—not over the defamation lawsuit itself—but the potential harm to the Four Pillars' brand arising from the additional scrutiny the lawsuit will inevitably attract. In my opinion the Achilles heel of the Four Pillars' business model is its ability to maintain satisfactory standards over some 50 plus locations across Canada."
Furthermore, Four Pillars franchises refer files—an estimated 3,000 consumer proposals annually— to a relatively small percentage of trustees in Canada. A significant percentage of trustees not receiving referrals from Four Pillars may resent the firm's very existence. Those individuals who wish to donate monies to Colleen Craig's legal defence can contact Ms. Craig's lawyer, Claire Hunter, litigationchambers.com, (Tel.: 604-891-2403) or via e-mail at [email protected].
Mark Silverthorn is the author of The Wolf At The Door: What To Do When Collection Agencies Come Calling, published by McClelland & Stewart, and he blogs regularly about the Canadian debt relief marketplace. In January Mark Silverthorn has written three LinkedIn posts on this widening conflict between Four Pillars, the trustees receiving referrals from it on one side and LIT Colleen Craig and Four Pillars' critics on the other. He invites anyone with information about Four Pillars to contact him.
SOURCE Mark Silverthorn, Barrister & Solicitor
For further information: Mark Silverthorn, Barrister & Solicitor, Phone: (519) 987-3270, E-mail: [email protected], www.silverthornlaw.ca