# Manitoba loser - Crocus Fund



## stantistic (Sep 19, 2015)

Has anyone who lost money in the above been able to claim the loses as an income tax deduction ?


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## Eclectic12 (Oct 20, 2010)

What methods of taking an income tax deduction are you thinking are available to apply the losses to income?

As it seems to be an investment fund, AFAICT the requirement for this to happen would be an investor that has to report capital gains as income. 
http://www.taxtips.ca/personaltax/investing/taxtreatment/capitalorincome.htm 

The run of the mill investor that is reporting capital gains is only going to be able to claim the capital losses against other capital gains instead of income.


Cheers


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## stantistic (Sep 19, 2015)

I am about as


> run of the mill


 as they come, but I do have from time to time some capital gains.


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## james4beach (Nov 15, 2012)

My dad lost money in Crocus. I'm interested in any info you have...


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## Eclectic12 (Oct 20, 2010)

https://en.wikipedia.org/wiki/Crocus_Investment_Fund
http://www.cbc.ca/news/canada/manitoba/crocus-fund-ex-bureaucrat-speaks-out-for-1st-time-1.1173942

The losses from buying/selling are straight forward but the larger picture result likely needs to take the Federal and Provincial tax credits into account. 


Cheers


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## stantistic (Sep 19, 2015)

j4b 

http://www.insolvencies.deloitte.ca/en-ca/Pages/Crocus Investment Fund .aspx


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## ian (Jun 18, 2016)

Sounds like the one we had in BC years ago. I think Barrett started it. Everyone got some shares as I recall, then they went public to raise money. Not sure what happened to it in the end, probably went south. I remember reading that the share value had decreased fifty percent over a two year period. My father bought some but I know that he eventually sold and wrote the capital loss off against some capital gains.

The NDP'ers loved it. They seemed to think it would move BC away from a resource based economy to something else.....even though at the time there was no underlying economic or financial reason for this change to occur. I think it was just one of the 'buy the vote' scams. Shortly after moving to Alberta Ralph Klein's Gov't sent us all a $300 cheque from the Heritage fund. I guess that was what the Alberta Provincial Conservatives figured a vote was worth at that time.


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## stantistic (Sep 19, 2015)

*Tax credits*

​Eclectic12 raises the issue of tax credits. In my view, if the total cost to purchase the shares was X and the Receiver recovers Y, then my losses for income tax purposes are X minus Y and tax credits along the way are irrelevant . Am I right ?


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## Mukhang pera (Feb 26, 2016)

ian said:


> Sounds like the one we had in BC years ago. I think Barrett started it. Everyone got some shares as I recall, then they went public to raise money..


I have an idea that you are thinking of Bill Bennett and the BC Resources Investment Corp. Everyone in BC got 5 free shares in 1979. It was not long before the 5-share certificates, which had a face value of $6 apiece, were selling for $40. Lots of ads in the newspapers from people looking to buy. BC residents could buy up to an additional 5,000 shares at face value of $6. I know people who bought their limit and made money by selling quickly for about $9 per share. That was the zenith. All downhill after that. I think I sold my 5 shares for about face value.


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## stantistic (Sep 19, 2015)

*Time running short*


There still remain a few old geezers who are entitled to the scraps remaining from Crocus. Our time is running out.

The problem with accessing the scraps is that distribution is stalled by a lawsuit between the receiver and a few investee companies. The Receiver gets paid annually and the investee companies get to use the funds. There is no incentive for them to settle. The original Crocus investors are "collateral damage" because they have no leverage.

Are there in Canada companies who buy up "distressed debt" to whom I could sell my shares now (assuming if ever a payment is made) ? 

Any other suggestions ?


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## james4beach (Nov 15, 2012)

So you're saying that the parties currently have no incentive to reach a settlement?

And you're looking for a company who might buy your distressed shares, thus giving you cash now, instead of when settlement eventually happens? Is that the idea?


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## Eclectic12 (Oct 20, 2010)

stantistic said:


> ​Eclectic12 raises the issue of tax credits. In my view, if the total cost to purchase the shares was X and the Receiver recovers Y, then my losses for income tax purposes are X minus Y and tax credits along the way are irrelevant . Am I right ?


For strictly getting to the capital loss on it's own ... then yes, the tax credits won't matter. The CL will be the CL.

Basically, the regular operation was that if one sold in less time than the required holding period (set by when one bought the units as the gov't changed the number), the tax return the credits were reported on would be re-assessed to cancel the tax credits previously granted/claimed.

As the fund imploded, maybe holding period was waived/cancelled. Should the units have been held for eight plus years before the implosion, the tax credits are safe no matter what.

https://www.getsmarteraboutmoney.ca.../labour-sponsored-investment-funds-explained/
https://www.theglobeandmail.com/glo...ved-but-experts-urge-caution/article29385610/




stantistic said:


> ... Are there in Canada companies who buy up "distressed debt" to whom I could sell my shares now (assuming if ever a payment is made) ?
> Any other suggestions ?


Sorry ... none that I am aware of. 


Cheers


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## stantistic (Sep 19, 2015)

james4beach said:


> So you're saying that the parties currently have no incentive to reach a settlement?
> 
> And you're looking for a company who might buy your distressed shares, thus giving you cash now, instead of when settlement eventually happens? Is that the idea?


Yes - that is my opinion.


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