The receiver’s investigation found that much of the money Sussman raised was never lent out as promised. Instead, investor payouts were likely funded by new investments, a classic hallmark of Ponzi operations.
Sussman’s business thrived during the multi-decade bull run in Canadian real estate, particularly in Barrie and Muskoka, dubbed the “Hamptons of the North” for its luxury lakeside properties.
As home prices soared, so did investor appetite for high-yield, private mortgages. But when rates spiked in 2022 and the market cooled, cracks appeared. Lawsuits allege Sussman missed repayments and failed to register some mortgages, leaving investors unprotected.
Lessons for syndicated mortgage investors
The Sussman case underscores the risks of syndicated mortgage investments, especially when trust and affinity play a central role.
Many investors, drawn by personal connections, invested without legal review or proper documentation — a vulnerability that regulators and industry groups have repeatedly warned against.