Jimmy Connacher is suing Caldwell Securities over Bridging Finance.

Jimmy Connacher’s heirs and Caldwell Securities are involved in a complex conflictual situation.
OPM 5 min read

Jimmy Connacher - the driving force of the legendary Gordon Capital - is now 85 years old. He wants to treat all his heirs (4 sons and 8 grandchildren) equally. But it’s my sad duty to report that some of them are at each other’s throat. Brother has been pitted against brother, nephew against uncle and - is nothing sacred anymore? - client against financial advisor.

This story will feature (directly or indirectly) some reasonably well-known Bay Street names:

-Jimmy Connacher, whose Gordon Capital became the largest volume trader in Canada in the 80s, accounting for 15% of the daily volume of the TSX.

-Caldwell Securities, founded by Thomas Caldwell, a past Governor of the TSX

In a supporting role:

-Michael Wekerle, aka The Wek and Richard Pilosof of RPIA, a credit focused fund

In January 2019, Jimmy Connacher was hospitalized following a mini-stroke (a “transient ischemic attack”). He was then diagnosed as having some damage to the frontal lobe of his brain and moderate dementia. The children requested an assessment and over a series of tests, Connacher was still deemed capable of managing property with professional assistance. In 2019, Jimmy Connacher’s youngest son, Ian made an application for guardianship of his assets. This move was eventually settled through mediation. But this created some bad blood between Ian Connacher on the one hand and David Connacher and his son Ryan Connacher. Jimmy and his grandson Ryan are apparently particularly close. Ryan has sort of taken the mantle of the name, he's a 29 year old wheeler-dealer. He's currently Head of Strategy at fintech Cake Capital. He splits his time between Toronto and the Bahamas. Here’s a sample of the mud-slinging that can be discerned from court filings:

-Ian Connacher alluded to the fact that David Connacher is subject to a lifetime ban from IIROC for trading related shenanigans. Ian alleged that Ryan started spending more time with his grandpa after his stroke in 2019 and “started improperly influencing his decisions”. Among other things, Ian alleged that Ryan impersonated Jimmy Connacher, sought control over his bank accounts, caused him to transfer assets to Ryan’s benefit, used Jimmy’s credit card and other assets to fund his lifestyle, and caused Jimmy to make poor investments for which he received a $125,000 finders’ fee from the issuer. (That fee is related to a $4.6m investment Jimmy C made in 2019 into Michael Wekerle’s Waterloo real estate company, Wekerloo. Shortly after making that investment, he decided to get out, which he was able to do with a small profit.)

-Ryan replies by alleging that Ian had always used his father as his own bank and had recurring financial problems as he “previously had a 25+ year severe addiction to cocaine, alcohol and gambling”. Ryan claims Ian was in rehab approximately seven years ago.

-Jimmy Connacher has a 252-acre estate in Stowe, Vermont, now on the market for $24m. Ryan alleged James Connacher Jr. (ie one of Jimmy’s sons) lived there rent-free. And that another son, Nathaniel Connacher, an artist based in Connecticut, drops by frequently. Ryan concludes by saying that they are therefore displeased with the property being put on the market.

As I said, the guardianship application was resolved out of court, so the allegations have not been tested, to the extent that they’re even relevant. David’s regulatory kerfuffle is true: his trading contributed to bringing down a small brokerage, Evergreen Capital Partners, in 2008. And the Stowe property is indeed up for sale and was featured in my rival publication, The New York Times. My point in repeating some of this material is not to assert any particular fact, but to show that family members are at each other’s throats. Like my other arch-rival William Shakespeare, I am drawn to Shakespearean tragedies.

This family dispute metastasized to eventually engulf a financial advisor at Caldwell Securities, Christopher Coderre. He was previously a director of fixed income trading at Scotia McLeod and at TD Securities. Apparently, Chris sold Jimmy Connacher on the idea of consolidating most of his assets away from his multiple brokerage relationships in favour of Caldwell. For ease of monitoring. And so Caldwell had $22m of Connacher’s money at one point.

The claim is a fairly mundane case of alleged advisor malpractice. The damages claimed are mainly capital losses of $4m and loss of opportunity of $2m. One example of a contentious transaction: Connacher held $11m in RPIA funds (value as of December 2018), but Coderre sold about $8m worth. Jimmy C and RPIA honcho Richard Pilosof are friends. The sale of RPIA funds was allegedly done without discussing with Connacher. That is representative of the nature of the dispute, ie about consent, suitability, etc. In September 2020, a Connacher account bought $2m worth of Bridging Finance. As is well known, Bridging Finance was then put into receivership in May 2021. Caldwell Securities and the advisor concerned have denied all these allegations and presented a robust joint defence. They claim that the complaint is about investment decisions that Connacher authorized and instructed.

The defendants came out swinging in a statement of defence by Shane D’Souza at McCarthys that I thought was well-drafted and strategic:

David and Ryan are urging the pursuit of this claim in retaliation for the defendants advocating for the best interests of Mr. Connacher and not supporting them in their self-interested attempts to manipulate Mr. Connacher. They mistakenly believe that the defendants will settle an unmeritorious claim to avoid publicity. They are wrong.

All unproven allegations, I hasten to add. Then they repeat some of the ammo that Ian used in his guardianship application (which I enumerated at the beginning). There’s some controversy over whether McCarthys are allowed to repeat the contents of Ian’s guardianship application given a sealing order that may or may not be in force. Am I myself violating any sealing orders? Thanks for your question. On the advice of counsel, I respectfully decline to answer. I am omitting another argy-bargy involving a change in the beneficiary designation of a life insurance, which one party contends was a conflict of interest while the other party contends is the result of forgery. I had to cut some material for the sake of brevity, but if you reply, I can send you some additional flourishes from McCarthys.

Jimmy Connacher is no stranger to conflicts. Here’s how an old article reported one of his contested deals:

In late February, at the height of the battle, Connacher sent Pitblado a live turkey. Pitblado sent back a dead duck. Connacher also sent corporate lawyer Howard Beck, a member of the prestigious Toronto firm of Davies, Ward and Beck, who was also acting on behalf of Union, a dead fish. Beck’s response: a live, captive dove.

And if you’re interested in another heir-y situation, here's a Google Image search  of “Brendan Caldwell”.

Behold the evolution of his hair and eyewear. That’s founder Tom Caldwell’s son.

If you need background on Jimmy Connacher, I previously wrote the Millennial's Guide to Gordon Capital .

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