By NEIL HARTNELL Tribune Business Editor LIQUIDATORS for Owen Bethel's Montaque Capital Partners have been recognised by the Ontario Superior Court of Justice through a ruling given "full force and effect" throughout Canada, a move critical to enabling them to freeze and gain control over the company's multi-million dollar assets. Bahamas-based accountant, Ed Rahming, who together with fellow KrYs Global partner, Kenneth Krys, is the liquidator for Montaque Capital Partners' Supreme Court-supervised winding-up, told Tribune Business it was "very important" to be recognised by the Canadian courts. "We have about six brokers or custodians for Montaque [in Canada], and we've basically got the recognition to ensure we've got the assistance of the courts there in freezing those assets and gaining control of those assets for the recovery," Mr Rahming said. "That's why it was done. Right now, the focus is gaining control of, and securing the assets, in Canada." Assets belonging to Montaque and its clients were held at six different Canadian correspondent brokers: Macquarie Private Wealth, CIBC Wood Gundy, Fidelity World Advisors, MFS Meridian, Global Securities Corporation and Global Maxfin Investments. In their first report to Montaque creditors prior to the company going into liquidation, Messrs Rahming and Krys expressed concern that despite requesting that Monatque's custodians "cease all activity on the company's accounts, Macquarie Private Wealth have advised that transactions may continue in the ordinary course of business to address margin calls, as applicable". "Despite the liquidators giving notice of their appointment and seeking that no transactions occur in the bank or custodian accounts without their authority, the custodians continue, after the liquidators' appointment, to liquidate positions held in the company's name (which may include those allegedly to be held for customers) to meet margin calls," Messrs Rahming and Krys wrote. Further explaining the importance of the Canadian court recognition, Messrs Rahming and Krys said in their first report that records as at July 31, 2011, showed a total of $7.392 million had been placed by Montaque Capital Partners between some 21 custodians. But the custodians had confirmed that of the same date, they held securities worth a collective $4.531 million and a negative net cash balance of $1.357 million, resulting in a total net value of $3.174 million. This was a $4 million difference, and Messrs Rahming and Krys said they had received account balance confirmations from 16 of the 21 custodians. The remaining five were said, by Montaque Capital Partners' accounts, to hold a collective $881,320. The majority of client investments were said to be held by Macquarie Private Wealth, which had produced information showing Montaque Capital Partners had some $197,777 worth of securities with it, but a negative cash balance of $3.125 million - creating a deficit of $3.018 million. It appeared, Messrs Rahming and Krys alleged, that Macquarie was relying on guarantees from Montaque Capital Partners to cover the overdrawn account and close it out. The liquidators said there were several occasions where it appeared "margin liabilities accrued which could not be satisfied from assets held for that purpose, either because the assets were illiquid or the assets' value had decreased and was insufficient to meet margin calls". The liquidators expressed fears this may have resulted in custodians' settling margin calls with assets belonging to other clients. They added that some custodians had continued to liquidate assets held in Montaque Capital Partners' name to settle margin calls despite their appointment. "Customers were allowed to maintain margin accounts with negative balances at the custodians and use penny stocks as the main equity position," the liquidators alleged. Mr Rahming, meanwhile, confirmed yesterday that the liquidators had already begun the forensic accounting process to distinguish between assets held in trust for clients, and those belonging to Montaque itself. With Montaque's custodians based in the US, Belize, the Bahamas, the Cayman Islands, Switzerland and Ireland, Chief Justice Sir Michael Barnett signed a request for aid and recognition from foreign courts, particularly in those nations, for the liquidators.