Forfeiture fuels record compensation for fraud victims
Vancouver - Victims of a doctor-turned-fraudster will share in a record restoration of funds recovered through a single B.C. civil forfeiture case.
The $928,769 recovered represents about one-third of the money raised by a one-time medical doctor who became a purported, yet unqualified, investment-pool operator. This fraudster used investors' funds to maintain a lavish lifestyle and buy valuable Lower Mainland properties. He also moved funds among businesses, bank accounts and term deposits in a manner consistent with money laundering.
B.C.'s Civil Forfeiture Act allows the provincial government to return forfeited funds to fraud victims who have a direct relationship with the money recovered. Since concluding this particular case in 2009, the Civil Forfeiture Office (CFO) has sought to identify victims - most recently, by publishing a legal notice in November 2012 - and have them document their claims for compensation. Qualifying victims will recoup approximately 70 per cent of their original investments, with approximately $400,000 of the recovered money going to nine B.C. residents and the rest shared among 12 claimants elsewhere in Canada.
This case represents the fourth and largest restoration of funds to fraud victims in the CFO's history. It is also the fourth concluded case that resulted from a referral from the BC Securities Commission (BCSC). These referrals follow enforcement action taken by BCSC staff and findings from BCSC panels. Consistent with past practice, the self-funding forfeiture program is covering its litigation and administration costs in this case to ensure the full value of the BC Supreme Court-approved forfeiture goes back to victims of this particular investment fraud.
Attorney General and Minister of Justice Suzanne Anton -
"Civil forfeiture's value extends beyond deterring unlawful activity and depriving criminals of ill-gotten gains - as this case once again proves. It's extremely positive to be able to return money to bona fide victims."
"Our government continues to support this very worthwhile program, which impacts those committing crimes such as fraud, drug, gang and other activities that threaten the safety and security of British Columbians."
Brenda Leong, chair, BCSC -
"Once again, collaborating with the Civil Forfeiture Office has helped to further our efforts to protect the interests of investors - in this case, a number of Canadians who had been defrauded of significant amounts."
- B.C.'s seven-year-old civil forfeiture program has recovered more than $31 million to date.
- While most of this total has gone to fund the activities of the self-funding program, including litigation, about $10.5 million has been invested in crime prevention efforts or returned to victims of fraud.
- Compensation occurs only in cases where a direct link exists between the forfeited funds and the financial loss suffered by an eligible victim or victims.
- The CFO works to deter unlawful activity by pursuing civil actions against property alleged to be a tool or proceed of that activity.
Read about a previous CFO-BCSC collaboration: www.bcsc.bc.ca/News/News_Releases/2011/48_Civil_forfeiture_returns_cash_to_Ponzi_scheme_victims/
View more on civil forfeiture compensation, including a link to the application form for compensation, at: www.pssg.gov.bc.ca/civilforfeiture/compensation.htm
The CFO's main page is at: www.pssg.gov.bc.ca/civilforfeiture/index.htm
Information about BCSC enforcement activities: www.bcsc.bc.ca/enforcement.asp
Government Communications and Public Engagement
Ministry of Justice
Connect with the Province of B.C. at: www.gov.bc.ca/connect
The BCSC is the independent government agency responsible for regulating trading in securities within the province. Learn how to avoid investment fraud at the BCSC’s investor education website: www.investright.org.