Business of the Month

When registered credit consultant and counsellor Cletus Castelino says he relates fully to how clients feel, he’s not just paying lip service."I have personally experienced financial difficulties and perhaps been in a worse situation than some of the people who approach me," he says.

Relating the "devastating experience", Castelino starts at the point where many immigrant stories begin. The mba from iim Ahmedabad came to Canada with a brilliant track record in blue chip companies in India and the Middle East. But this was back in 1990, before India had received such good press, and he found that most people hadn’t heard of iim, one of the country’s premier institutions. When he spoke of years in the Middle East, he came up against the enduring perception of nomads in the desert.

Castelino found a job – not in his field, but it was a start. His wife found a job as a legal secretary in a prestigious firm and their daughter settled into school. They bought a house with the money they had come to Canada with and things seemed to be going well.

But they were dipping into equity and Castelino was also working almost 24/7. He soon realized he had to make a change. He bought two locations of a franchise in the baking business. Within six months he knew he had made a big mistake. The franchises didn’t live up to the promise, the locations weren’t the best and the cost of doing business was too high. He saw the money he’d invested disappearing fast.

"My wife and daughter were pillars of strength and our faith grew stronger than ever in that trying period. We prayed hard and though we were at the brink of losing our home, I can honestly say we were almost emotionally detached from the turmoil in our lives," says Castelino.

His rational mba-trained mind told him that he should also be taking some action to prevent financial ruin, but didn’t know what, exactly.

"At what I call the 11th hour, 59th minute, God came to our rescue in the form of a customer at my store. While he was waiting for his order, I asked him, ‘So what is it that you do?’ Now you must understand that I never asked people this before, this was not my version of small talk! But something made me ask this man and he said he took care of people in financial trouble. ‘Small businesses like mine?’ I asked, and he said, ‘Especially like you’! Next thing I knew I was sitting in his office."

Legally, and with full protection, Castelino took refuge under the Bankruptcy and Insolvency Act, declaring the company insolvent without losing his home and assets.

The man who helped him also encouraged him to work in the same line and after getting the necessary qualifications, Castelino was in the business of helping others stay out of financial trouble. After working in the Polish community for a few years, he began concentrating on the desi community in 1999, and hasn’t looked back since.

"Earlier, if I saw five to six clients a month, now I see 25 to 30 in the same period.’

Lest you think otherwise, he clarifies that this is not an indicator of a community in trouble. On the contrary, with increased awareness, more people are realizing that there is a way out of financial tight corners.

Castelino sees his clients as victims of unfortunate circumstances. They might have made the wrong personal choices or been sold a business under false pretext. "When I was trying to sell my business, I would tell prospective buyers that I was selling it for next to nothing because it wasn’t doing well. While they appreciated my honesty, they didn’t want to buy! Eventually, I had no option but to declare my business insolvent. But I know from experience the oversell one gets when someone is trying to get you to buy a business. It’s easy to get duped."

When someone calls him, Castelino, who speaks English, Hindi, Gujarati and Punjabi and has a working knowledge of Bangla and Tamil, asks a few questions to assess the seriousness of the situation. An interview is scheduled during which he takes the person through a structured format covering personal and financial details, starting from the purchase of the business, or if it’s wage-related, to how long the person has been unemployed, etc. He identifies the cause of debt – was it gambling, substance abuse or was the person laid off – to prevent a recurrence and to help clients move back into the society.

This initial consultation is free. Sometimes, a person will return after six months and say that though he is ready to sign up now, his circumstances have changed in the past months and he would like another review. "I oblige. But that’s it! I will not go through the process repeatedly."

The next step is to sign a document stating that the client has understood the process, is not hiding anything and is complying with the law to the best of his or her knowledge. After Castelino gets all the information and does all the paperwork, a court-appointed trustee of his choice (based on his geographic location and client convenience as well as past experience in that type of insolvency) completes the process. At the end of which, the trustee gives the certificate of discharge of debt.

Asked why someone should go to him and not one of the many others in the community claiming to offer more or less the same service, Castelino says, "My success rate. It’s as simple as that! When I take a case, I get the job done. Throughout, I retain control of the process as opposed to filling out a form and handing it over to a trustee in bankruptcy. What many people do not realize is that a trustee in bankruptcy works for the creditor. I keep on top of the latest jurisprudence and use it to my clients’ advantage. I also continue to stay involved in their welfare after, strictly speaking, my job is done."

But in all of this, who is looking after the creditor?

Castelino says he is aware of the fact that people think he protects those in debt to the detriment of those who lent the money. That someone who owes money should pay up or face the consequences.

"To them I say, the law protects the creditors. Just as it protects people who are victims of their circumstances. The law protects them from poverty – not just them, but their kids. If it didn’t, we’d see more people on the street. More people would be throwing themselves out the window in despair. Then who would look after their families? And in such situations, the creditor would get nothing. One must look at the cause.

"My conscience is clear. There have been times – it’s very rare – when I’ve turned a case down because the intentions seemed less than honorable. But by and large, my work has made a difference in the lives of people. They say the best gauge of success is a referral and I’m happy I get many! But more than that, what makes me really happy is that clients will often come back to tell me how they are doing now. We establish a relationship over the period we work together and they know I am genuinely interested in their welfare. So they come back to tell me and I see big smiles, I hear them say, ‘God is great,’ repeatedly and it makes me happy.

"The best call I can get from a client is one in which he asks for the name of a trusted financial advisor – when they want to invest in rrsps or in insurance packages for the family, I know they have truly turned the corner."

• Cletus Castelino can be reached at 905-848-0006.

• Keep an eye on the nature of income – short-term as well as future. Be aware of the lack of permanence of income. "There’s no such thing as job security," says Castelino. "In a business, consolidate revenue earning sources." And keep looking for an alternative, have Plan B handy.

• Be cost conscious. As Castelino is fond of telling clients, don’t give into the amdani atthanni, kharcha rupaiya (spending twice what you make) syndrome.

• Don’t be misled by the illusion of credit – credit erodes the next pay cheque.

• If you are falling back on payments and using assets to survive, you could be a borderline credit victim. Don’t live in a dream world, assuming that you have managed before and will manage again.

– If you can’t sleep at night and wake up with sweat on your brow.

– If you find yourself so hassled that you are not listening to your child but running worse case scenarios in your head – over and over again.

– If you are getting collection calls at home and at work and legal notices in the mail.

– If you are falling behind on bills and are unable to make mortgage or car payments.

If you answered yes to three or more of these, you might need to seek professional financial advice.