June 3, 2022
Canamidex International Corp., a Richmond Hill, Ontario-based supplier of parts and materials to the Canadian Department of National Defense, the NATO Support and Procurement Agency ("NSPA") and the Defense Logistics Agency, filed an NOI on June 3, listing $3.7 million in liabilities, including $3 million to BMO Financial Group. The company’s insolvency can be attributed to a specific contract with the NSPA that has resulted in losses to the company that it was not able to sustain. In 2020, the company entered into a relationship with California Aircraft and Avionics Corporation (“CAAC”), whereby Canamidex would purchase parts from CAAC and supply those parts to NSPA, to fulfil its obligations as part of the contract. In September 2021, NSPA contacted Canamidex to inform Canamidex that certain products were incorrect and counterfeit. Accordingly, NSPA halted all further orders and payments under the contract, and later cancelled the contract in June 2021. It appears that the company was a victim of a fraud that was perpetrated by CAAC. It has engaged counsel in the state of California to take legal action against CAAC. Crowe Soberman is the proposal trustee. Counsel is Goldman Sloan Nash & Haber for the company, Simpson Wigle for the proposal trustee and Chaitons for BMO.
By Dina Milivojevic