Calgarian who defrauded eight American business owners sentenced to a year in prison
A Calgary man has been sent to jail a decade after he and his business partner defrauded eight American small business owners of $286,340 through what was described as a joint venture collateralization program.
Provincial court Judge Marlene Graham on Tuesday declined defence lawyer Andrea Urquhart’s pitch for a community-based conditional sentence for L.L. primarily because he has never attempted to return any of the money he embezzled.
The judge did, however, reduce the 18-month jail sentence sought by Crown prosecutor Steve Johnston and gave L.L. a year behind bars, because of his guilty plea.
She also ordered the offender to pay back half of the total amount, for which he was responsible. His business partner in Wiseman Capital Inc., Lou Renaud, died before trial.
"While I assessed this offence of fraud as not a trust theft, or from employers, I do find there is an element of trust in that part of the scheme, as I understand it, involved the victims being referred to his company through brokers," said Graham.
"There is some legitimacy, as they must be licensed or regulated, and there is an expectation of clients of legitimacy."
Graham said it was an aggravating factor that it was a scam that crossed borders and makes it very difficult for the victims to successfully litigate in Canada.
According to an agreed statement of facts, Renaud would refer to the program as 'medium term asset-backed notes' and L.L. would refer to 'collateral' This program suggested that in exchange for a fee.
Wiseman, which professed to be able to provide between $1 million and $100 million of collateral, would credit enhancement for corporations seeking lending agreements, by supplying medium term asset-backed notes or other forms of financial instruments, which would act as collateral to support obtaining loans from lenders.
The problem, Johnston told court, was there was no collateral available. Urquhart cited the guilty plea and taking responsibility for his actions for seeking a non-custodial sentence. She said his plea saved the state several weeks of trial time and resources.
She also noted the period of the fraud was relatively brief, from March 11 to June 28, 2002, and he is a low risk to reoffend.
L.L. also admitted having a gambling problem, but it was not used as an excuse for the crime.
Daryl Slade, Canwest News Service
March 5 2013