Canadian Lawyer Draws 9 Year Jail Term for Ponzi Scheme

Canadian Lawyer Draws 9 Year Jail Term for Ponzi Scheme 2

A Calgary lawyer involved in a Ponzi scheme that attracted around $37 million from investors has drawn a nine year jail term.

 

The long-running criminal case finished on Wednesday with the stiffest prison sentence handed to any of the three principals behind the scam.

The Calgary Herald reports that Judge Allan Fradsham handed former Calgary-area lawyer Garth Bailey a nine-year prison sentence for his involvement in HMS Financial.

A retired RCMP commercial crime investigator who led the criminal probe into the case said the sentence is an appropriate punishment, but it doesn’t erase the financial strain on many investors who lost their savings to Bailey and his co-conspirators.

“It will never bring justice to the victims, but it was a very well thought out decision,” said Dale Glydon, who was in the courtroom for Fradsham’s ruling.

The sentence is close to the maximum penalty available at the time of the offences in the early 2000s and in line with the eight- to nine-year term sought by prosecutor Steve Johnston.

“The exact amount of the funds lost by investors as a result of the offending conduct of Bailey was not established, but I am satisfied beyond a reasonable doubt that it totalled in the tens of millions of dollars,” Fradsham said in a written decision.

Fradsham convicted Bailey in May of fraud over $5,000, laundering proceeds of crime and conspiracy charges. The judge handed Bailey an eight-year sentence for the fraud conviction, a one-year consecutive term for money laundering and identical concurrent sentences for the two conspiracy convictions.

Bailey, 61, was the lawyer for HMS Financial, which was established by Harold Murray Stark and Robert (Colonel) Fyn in 2000 and headquartered in the central Alberta community of Linden.

Fyn was considered the “directing mind” of the scheme and received an eight-year sentence after pleading guilty to fraud over $5,000 in 2011, while Stark received six years after admitting guilt to the same charge.

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