The federal government’s lending agency in Atlantic Canada has been criticized for repeatedly postponing loan repayments from a Halifax company that has earned no revenue since 2006.
Charles Cirtwill, president of the Atlantic Institute for Market Studies think-tank, said the Atlantic Canada Opportunities Agency routinely gives VR Interactive Corp. more time to start repaying a multimillion-dollar loan to the federal government, even though VR Interactive no longer makes money.
“A bank would have told you this is a bad debt. This is money you are not going to receive,” said Cirtwill.
Between 2001 and 2004, VR Interactive received more than $600,000 in federal loans and grants to develop photography hardware and software.
The company recorded zero revenues in 2007, 2008 and 2009, and it was taken off the TSX Venture Exchange last month for lack of operating activity, assets and capital deficiencies.
Its old offices in the Bayers Lake Business Park in the Halifax area are now occupied by a beauty salon and the phone number listed on VR Interactive’s website is not in service.
Cirtwill said ACOA is not acknowledging the bad debt to make its own books look good.
“If they carry things on their books as good debt, their balance looks better than it should,” Cirtwell told CBC News.
In a statement, ACOA said it is continuing to work with VR Interactive.
“ACOA continues to work with the company to help it overcome its current financial difficulties while at the same time taking all appropriate actions to protect taxpayers’ investments in this company,” it said.
ACOA last put off VR Interactive’s loan repayments in August. The agency said it will review the file again this year.