BANKRUPT BANKER
Mounties have charged the three alleged masterminds of a $60-million U.S. Ponzi scheme that victimized investors in Canada and the United States.
Supt. Eric Mattson, officer in charge of RCMP K Division Financial Crime Program, told reporters Monday three Alberta men have allegedly bilked cash from 1,000 victims.Police looked into allegations of investment fraud and money laundering against HMS Financial Inc. between 2001 to 2004.
Investigations began in 2004 and spanned six years, in eight different countries involving international banking, before Mounties charged the suspects.Mattson said victims, half of whom are Albertans the rest Americans and residents of other Canadian provinces, were told their investments with HMS Financial were to return up to 12% monthly and were risk free because one of the company’s owners held bonds valued in the millions that would be liquidated should the investments fail to pay out.
“There’s no such thing as risk-free investments,” said Mattson.“How can you make 100% or 150% return on funds? It just doesn’t seem to make a lot of sense,” he said.Investors who were victimized trusted scheme promoters who may also have put in cash not knowing they were being scammed, police allege.Most of the victims didn’t do due diligence and failed to seek second opinion from banks or investment specialists and simply trusted promoters who were family members, friends or acquaintances from church, said police.Sgt. Dale Glydon with the RCMP Commercial Crime Section, said it would be difficult to retrieve what people lost because the money in this kind of scam kept moving, most of the time out of the country.
“Investors lost as small as $5,000 to in excess of $250,000,” said Glydon.
A Ponzi scheme usually lasts for about 18 months, but this one kept going longer because some investors got returns, but HMS Financial collapsed just as the RCMP began investigation, cops said.Police have spoken to about 300 victims but they hope 700 others will come forward.
The accused will appear in Drumheller Provincial Court on April 16.
Charged with fraud over $5,000 are (Harold) Murray Stark, 73, of Three Hills, Robert Fyn aka Col. Robbie Fyn, 62, of Linden, and Garth S. Bailey, 57 of Okotoks.The three, along with Katherine Rodrique Bailey, 53, of Okotoks, are also charged with money laundering.
