PANEL:	JOYCE C. MAYKUT, Q.C.	VICE CHAIR
	JOAN L. BROCKMAN	MEMBER
	ROY WARES	MEMBER

APPEARING:	PATRICIA TAYLOR	FOR COMMISSION STAFF

On June 23, 1997, Armstrong was charged with seven counts of fraud over $5,000, contrary to sections 380(1)(a) of the Criminal Code. These charges relate to the first seven of Armstrong’s victims. On August 18, 1997, Armstrong pled guilty to six counts and was sentenced to two years in jail, then three years on probation upon certain conditions including attendance at a rehabilitation clinic for a gambling addiction. In addition, Armstrong was ordered to perform 200 hours community service and to pay compensation to his victims of $139,159.

On November 13, 1997 Armstrong was charged with a further two counts of fraud over $5,000 contrary to section 380(1)(a) of the Criminal Code. These charges relate to all of the funds Armstrong defrauded from the retired couple and Raul. On March 24, 1998, Armstrong pled guilty to both counts and was sentenced to four years on the first count, three years on the second count, both to be served concurrently with the two year sentence Armstrong was already serving for the earlier convictions.

Certainly as it related to the retired couple and Raul, Armstrong’s modus operandi was simple. First he befriended and gained their trust. Then he proceeded to concoct stories about himself and make representations that were false with the intention of inducing them to give him money. Among other things, Armstrong represented that he was a helicopter pilot employed by an established diamond exploration company and that he was able to and would purchase for them securities in this company at a preferred price. To the retired couple, Armstrong specifically represented the company was Dia Met and that he was a close personal friend of the company’s president, James Eccott. None of this was true. Armstrong also told the retired couple and Raul that they should purchase shares at either $0.10 or $0.20 a share, which he then represented they could sell on The Toronto Stock Exchange for $5 per share in the near future. Having recommended the purchase of these securities, he then convinced them to agree to have him purchase and then hold the securities he purportedly bought on their behalf. Armstrong never purchased any securities for himself or for the retired couple and Raul.

None of the representations made by Armstrong to induce the retired couple and Raul to give him money for the purported purchase of securities of a diamond company or of Dia Met was true. Indeed none of the representations made by Armstrong to induce his victims to give him money for any other purpose was true. Armstrong simply misappropriated all of the funds for his own personal use, often to pay off gambling debts.

The retired couple lost over $65,000 of their savings to Armstrong. The experience was, and still is, financially and emotionally very painful for them. Our intention in reproducing practically the entire affidavit of the husband, was not to grieve them further but to demonstrate how slick and convincing Armstrong was and to educate others who find themselves in similar circumstances. The affidavit states as follows:

1. …Rosemary …our tenant and friend, had met this “nice man” in the park on approximately June 15, 1996, while her grandson was playing T Ball.

2. Rosemary told us that Norman Armstrong came from the same town, Kirkland Lake, Ontario, and that Mr. Armstrong knew all her family. Rosemary said that Norman was a helicopter pilot with Okanagan Helicopters Ltd. based in Kelowna, B.C.

3. According to Rosemary Norman told her that he owned a house on Grant Street, near 1st Avenue and he showed her the 3,000 square foot Mediterranean style home. Norm told Rosemary that she could live there if she wanted to. Rosemary was very excited and showed the home to [my wife] on approximately June 20, 1996. This was also the first time that [my wife] and I were introduced to Norman Armstrong.

4. Norm came over almost every day for a week. It was nice out and seven or eight people sat around the outside patio table having tea, juice, or a beer now and then. Norm was the perfect gentleman, never swore, no dirty jokes, did not smoke except for an occasional pipe when he was out in the bush fighting forest fires, and he absolutely never drank. Everyone commented what an amiable man he was, including [my wife] and I. We really got to like him.

5. In July, 1996, he was gone a lot, he told us, to fly for Okanagan Helicopters fighting forest fires and bringing supplies, men, and equipment to remote places in B.C., Washington, and Oregon. He was the senior pilot for Okanagan and had a license to fly night flying with a jet ranger helicopter. He came back over to see us at the apartment patio after flying for a week, and then taking four days off. Norm talked about all his exploits of flying for 28 years.

6. Norm told us he had been to most countries in the world. He named specific places like Australia and New Zealand. Norm also told us he had a sheep ranch at Reef Town, New Zealand. The reason I know Reef Town is that my sister used to live near Nelson and I went there for a visit. Norm did not know I had been there. I never told anyone in the apartment about that trip.

7. We visited back and forth with Norman and Rosemary between the patio and our suite. Norman used to come in with muffins in the morning and we would talk politics, sports, the weather, fishing, etc. Norman would be praising the Lord for all his blessings and he would start singing “Jesus Loves Me” etc. He showed us his two children’s pictures and pictures of his cabin on the lake near Sudbury, Ontario.

8. Norman told us about his brothers and sisters. One sister had died from cancer last year and she had lived at 1220 West 13th Avenue, Vancouver, where he used to live with her as he was divorced from his Muslim, Fijian wife. It was a nasty divorce he told us but he had custody of his children. He also told us his older brother had told him he was crazy to get into another relationship with another woman Rosemary.

9. Norm told us his older brother was a Senior Immigration Officer with the Canadian Government. Norm used to drive his brother around Vancouver or pick him up from the airport. He told us his family had very high moral standards. He told [my wife] and me how happy he was to meet such good God fearing people like us. He asked [my wife] if she would help him to get Rosemary to curb her smoking.

10. Near the end of July, 1996, he said he put his Grant House street up for sale as he wanted to marry Rosemary and buy a place in the Fraser Valley, he thought Cloverdale would be a good place, five acres or so he said. He wanted me to come along to check it when he was ready to buy, as he had custody of the kids, his son Erik age 11, and his daughter Melissa age 15, who liked to have a horse of her own. He told me he should clear about $390,000 on his house on Grant Street.

11. I have reviewed the Information by Indictment contained at Page 6 of the Document Book of Staff of the Commission in these proceedings. Count 1 refers to the period July 31, 1996 to March 17, 1997, when Norm Armstrong stole our money.

12. This money was given to Norm under completely false and fraudulent pretenses as can be seen from the story I relate below. Every time I read my notes of my dealings with Norm during this fiasco, I cannot believe I was so manipulated by Norman Armstrong.

13. This is the story.

14. On July 31, 1996, we were sitting outside on the patio at 10:30 a.m. having coffee when some other people and Norman asked if they could talk privately to us in our suite. He said “you two have been such wonderful friends to me, I love you and I see you don’t make that much money at this job”. He had the Northern Miner with him and showed us the story of Diamet Minerals’ find of diamonds 300 km north of Yellowknife. They had drilled Kimberlite cores and the diamonds were of gem quality.

15. The article said that Mr. Eccott, the President of Diamet and the Australian mining concern called B.H.P. were negotiating with the dog rib peoples and the Federal Government for access to the diamond find. It looked 100% sure they would get approval. Norman told us he had flown Mr. Eccott all over the place exploring for diamonds. Norm had helped Jim Eccott financially when he was a poor geologist. “Now”, said Norm, “is pay back time”. “Look”, said Norm, “I missed out on the first stock option 1991/92 because I was flying helicopter for oil exploration in Australia, do you know that the Diamet A stock rose from 10 cents a share to over $60.00”? “Look”, says Norm, “I flew Mr. Eccott out to a remote Okanagan Lake to build a log cabin and a boat dock.” Norm said that Eccott told him that if he would fly the Diamet Jet Ranger and ferry the log home and a floating dock for boats over to the remote lake site one weekend in August, 1996, Diamet would split the stock because they want to make it attractive to small investors like you and me.

16. Norm said, “I can get you 6,000 shares of Diamet C stock @ 25 cents a share”. Norm said, “I can get you in now at a very low cost, give me $1,500.00 cash and I will take it along to Mr. Eccott’s broker on West Georgia across from the TD Bank head office where Mr. Eccott and his accountant have their office”. Norm was so very convincing, he said “As the Lord our God live may I not fly another hour as a helicopter pilot”! I said, “Norman why should Mr. Eccott or Diamet sell us his stock not knowing who [ I ] and [my wife] are?” He said, “you are my dearest friends”.

17. [My wife] and I talked it over and we asked when we would get the Diamet C stock certificates. Norman said, “the certificates had to come from Toronto as Diamet had their head office there”.

18. We were still very hesitant. Norm said “…, you get a deal like this once in a lifetime. You owe it to your two lovely daughters and your grandkids, don’t you want to retire next year?” “[Your wife] has health problems”. I still questioned him if the certificates would come in October 1996. Norman said “… you are supposed to be a good Christian, oh ye of little faith”.

19. Norman said “I tell you what, you get a ledger book and keep records of all the transactions. I am giving you a receipt for each block of shares I sell you”.

20. He said “I am giving you my phone number where you can reach me anytime when I am not flying, besides I see you guys everytime I see Rosemary”. [My wife] and I gave Norman $1,500.00 cash and he gave us a receipt with his signature. That receipt is found at …

21. Norman came in all excited on the morning of August 6, 1996, telling us we could buy more Diamet C stock at 25 cents a share. Norman was going to arrange everything with the brokers and Mr. Baldwin, Mr. Eccott’s accountant at the West Georgia office. We were hesitant at first because we had not received the stock certificates from the first block he sold us. Norm said “as God lives, the stock certificates will all be sent to you by October 1996.”

22. He said “I have to fly out with Okanagan Helicopter this afternoon, get me $3,250.00 cash and I will give you a receipt for 12,500 shares of Diamet C stock.” I said “Norm, can’t I give you a cheque?” He said, “they only handle cash for junior stock options”! Norman was so very convincing, we got him the $3,250.00 cash and he gave us a signed receipt. A copy ….

23. Norman came in on August 14, 1996. It was on a Wednesday morning and he had coffee with us and told us he had been flying the helicopter for Okanagan Helicopters to fight forest fires in Oregon. He told us he found a black labrador dog in the middle of a burned out clearing and told us other related stories of the past week of his work.

24. He said he had a phone conversation with Mr. Eccott and his accountant Mr. Baldwin, he showed us a Toronto Globe and Mail stock report on the different companies selling warrants as operating expense. Norman said “I am going to buy 25,000 warrants @ 10 cents a share and do you and [my wife] want to get in, the warrants could sell at the Toronto Exchange for $5.00 per share or more in a year.” We went to the bank and got $2,500.00 cash, paid Norman and he gave us a signed receipt that they would trade at the Toronto Exchange at the end of October 1996. A copy…

25. Norman came over to see us on a Monday evening August 26, 1996, he told us he had been flying Mr. Eccott up to Whitehorse and the Yukon where they had been looking and staking diamond claims and they had had a long conversation and since Norman had helped Mr. Eccott financially, he had offered Norman 10,000 Diamet A & B shares they were selling for $18.00 to $19.00 at the Toronto Stock Exchange right now.

26. Norman had us under his spell. If I look at the Diamet receipt now, I could vomit. We bought 5,000 shares of Diamet A & B stock for $2,600.00. A copy…

27. [My wife] and I had our holidays, we were at our Sardis home and Rosemary and Norm came over for a luncheon. We also invited friends … who then met Norm for the first time. Norman talked to [my wife] and I privately and told us he had just moved Mr. Eccott’s cabin and boat dock and he had another option to buy Diamet B stock. Norman said “God loves us and we are all going to get rich”. [My wife] and I said “if the stocks get sold October 3, 1996, God willing we can help a lot of people we know that are in need”.

28. Norm said “Oh ye of little faith” and we paid Norman G. Armstrong $4,800.00 cash. Norman gave us a receipt for 10,000 shares of diamond B stock, he explained that the stock was owed to him that is why he was offering it to us at $2.08 per share including brokers fees. A copy…

29. Norm told us he had still not sold his house on Grant Street, Vancouver, he also told us he was quitting flying for Okanangan Helicopters and was now strictly flying for Diamet and Mr. Eccott, he also told us Mr. Eccott did not want people phoning him and had an unlisted number only Norm could reach.

30. On Wednesday, September 16, 1996, (by now, we had given Norm $14,500 for shares in Diamet) Norm phoned early in the morning. He said he had to fly to Toronto to the Diamet office there and meet a geologist from B.H.P. Mining Australia, and that if we could meet him at Knight & Day restaurant at Boundary Road and bring him $1,500.00 cash to buy Diamet warrants @ 10 cents a share. We drove all the way in from Chilliwack to pay him and he gave us a receipt. Norm looked us straight in the eye and told us “we were his dear friends and I pray for you two people everyday”. We are going to be rich he said. A copy…

31. We were excited and told our two daughters about it. They were not enthused at all, because we had no stock certificates to show them. Our eldest daughter asked how much we had invested and would invest and we said 20 to 25 thousand dollars. They were very skeptical.

32. Norman called us on the evening of September 16, 1996 to tell us his flight to Toronto and Diamet office was delayed as there was a problem with the lear jet but he was talking to Mr. Eccott and brought us the article in a September issue of Macleans magazine about a gem of a ruling stating that a deal had been made with Diamet Minerals and Broken Hill Proprietor (B.H.P.) Minerals of Australia, that the federal cabinet had given the approval to go ahead with the diamond mine north of Yellowknife.

33. Norm said he talked to Diamet’s president his friend. I told Norm that I sure would like to meet this Mr. Eccott. Norm said “… my dear friend, trust me oh ye of little faith, you will in due time”. I said why would Mr. Eccott sell us any of his current A & B stocks?

34. Norm said “Jim Eccott is an honourable man, he said a friend of Norman’s is a friend of mine”. Norman said Mr. Eccott would meet with us in October 1996 at the accountant’s office on West Georgia Street. We paid Norman $3,200.00 for 10,000 A & B shares and Norm wrote a receipt on a scrap of paper and signed it (I lost originals). A copy…

35. Norman Graham Armstrong came to see us for breakfast on Thursday morning September 26, 1996 and told us he thought he had a buyer for his house on Grant Street. He also told us he had been to the Diamet office in Toronto with Mr. Eccott and that there had been an argument with the B.H.P. executive about the selling of warrants on the Toronto Stock Exchange.

36. He told [my wife] and I we could buy another 15,000 shares of Diamet A stock and an option on another 5,000 if we wished, this was the last chance for us to get the stock at such a low price. We paid Norman $3,400.00 cash which included brokers fees. A copy…

37. He said the optional 5,000 shares would cost more. We asked no questions as he told us the A stock was worth $18.00 per share. He also asked us that he was short of money and if we could loan him $2,300.00.

38. We gave him all the cash from the Royal Bank Kingsway branch and [my wife] picked it up for Norman. The bank teller questioned [my wife] on such a large withdrawal. We had money in T Bills which came due that time and put it in our current account and told Norman about it who said “[My wife and I] my dear friends as the Lord lives trust in me, just you wait, November 1996 we will all be rich”. We gave him all that money cash and he made out receipts on which some mistakes were made on them. I corrected them with bold print after Norman had signed them. A copy…

39. Norman said he had to fly to the Yukon and Whitehorse with Mr. Eccott and he would be back in a week or so. He was going to pilot Diamet’s and Broken Hill Proprietary Company and take the geologist to check out diamond claims in the Northwest Territories. Shortly after, Rosemary … heard that Norman had been downed with the jet ranger helicopter while flying at night, approximately 100km southeast of Whitehorse, Yukon due to battery failure.

40. Norman came back to us all here just before our Annual Tenants Thanksgiving Dinner we have every year, approximately 45 people came out for it. Norman got us all the turkeys and hams and other groceries wholesale. We saved over $100.00 on the food cost. Norman used to pick up the food for the logging and mining camps. We had a nice Thanksgiving which Norman also attended briefly.

41. Norman came to see us quite often if he was not flying. He told us he had a chance to buy the jet ranger helicopter from B.H.P. He also told us he had sold his house on Grant Street. He said “[to my wife and I], here is your chance to help me out, since you always asked me why would Mr. Eccott sell us all those Diamet shares?” Norman said “remember I said you might have to help me out sometime?”

42. Norman said money from the house he sold won’t be coming in until December 1996. He came to see us October 21, 1996 and he looked very distraught. We asked what was the matter. He said you know, I can buy a helicopter but I have come up with $6,000.00 cash and deposit and wire it to Toronto to keep the jet ranger there. We gave him $6,000.00 cash deposit and he gave us a receipt with tears in his eyes and said “God Bless you two, I will make it up to you both just trust me”. He looked us straight in the eyes and hugged us, we must have been hypnotized. A copy…

43. The next day October 22, 1996 early in the morning Norm brought along blueberry muffins and [my wife] made the coffee. Norman said “I have great news, Mr. Eccott will sell on our behalf 50,000 A & B shares at the Toronto Stock Exchange, being 25,000 [me and my wife’s] shares and 25,000 Norman shares. Total dollar value would be $475,000.00 [me and my wife] and $475,000.00 Norman at $19.00 per share approximately, moneys to be paid out on Tuesday, November 19, 1996 at 10:30 a.m. at Mr. Eccott’s accountant’s office on Georgia Street, Vancouver. We will also sign all documents for the total shares A, B, and C and warrants we purchased. Remainder of the stock to be sold later 1996/97. We were elated. Norman gave us two notes describing transaction. A formal typewritten letter would follow he said. A copy…

44. Norman came to see us often all excited. I was still saying “if”. Norman looked us straight in the eye, “trust in the Lord ye of little faith”. On Tuesday morning, November 5, 1996 he came and asked us for $3,000.00. He would pay us back as soon as his cheque came in from the house he sold. We gave him $3,000.00 for insurance on the helicopter and he gave us a signed receipt. A copy…

45. Norman came over often and we talked politics, sports, religion, places for him to buy when he got all the moneys from the shares. He told us he was quitting as a pilot for Diamet and B.H.P. and that after he got the money to buy the chopper he would just do some contract work. He wanted to spend more time with his children Erik and Melissa. He hoped to marry Rosemary if she would only curb her smoking.

46. Norman came over to see us November 12, 1996 on a Tuesday, he had been talking to mining people who advised (us and him) to look for tax write offs for 1996/97. Norm came with a detailed map of the Teslin River near Atlin, B.C. Norm said to [my wife] and I “we can write off a lot of taxes by staking and doing a little work up there”.

47. Norman said “I have the helicopter and I’ll take [my wife] and you up there next June and we will stay a few days and hire some people and pay them to do a little work up there. He looked us straight in the eyes and said “we need $6,000.00 to keep all the claims in good standing. I have to have the money by tomorrow”. [My wife] and I went to the bank to pick up the $6,000.00 cash and we gave the money to Norman on Wednesday, November 13, 1996. He wrote us a signed receipt …

48. Norman came over a few days later and he said he had had a long discussion with Mr. Eccott, his accountant, and 3 other minor shareholders of Diamet. Mr. Eccott proposed to Norm that he would buy out all our shares and warrants for $15.00 per share. Norman said to us “we have 230,000 shares and warrants, buy out by Mr. Eccott would be 230,000 Diamet shares at $15.00 per share and the total would be $3,450,000.00 and that would be $1,725,000.00 to [my wife and I ]. Mr. Eccott’s company has 43.3 million in the TD Bank, Main Branch, West Georgia. He said Eccott arranged for bank drafts to be ready for December 3, 1996; $500,000.00 for Norman Armstrong and $250,000.00 for [my wife] $250,000.00 for [me] and some taxes to be paid later, this information was on a hand written document of Norm which can be found at pages 34 and 35 of the Book of Documents. The document records:




March 3/97	$250,000 [ wife] $125,000	[me] $125,000
June 3/97	Norman $250,000 [wife] $125,000	[me] $125,000
August 3/97	Norman $250,000 [ wife] $125,000	[me] $125,000
October 3/97	Norman $250,000 [ wife] $125,000	[me] $125,000
December 3/97	Balance of money to be transferred to Norman	[my wife and my] accounts.



The tax paid on the $500,000 shares would need us to set up an appointment with accountant in May 1997 as the best way to pay later taxes. It said the Bank will issue papers on the tax to be paid, also documentation of stock bought and sold. It recorded advice to keep dealing with TD Bank on Georgia.

49. [My wife] and I were optimistic. We asked Norm when we could meet Mr. Eccott and Norm said I will bring him over for coffee very soon. “Remember” Norm said “Mr. Eccott is a very busy man”. I said to Norman man that sure is a lot of money we are making on a $50,000.00 investment (Norm, [my wife and I]). Norman said “how do you think B.H.P., Diamet and Mr. Eccott made it”. Diamet minerals have over 200 million in the bank and B.H.P. 2 billion. [to me] ye of little faith, trust in me my friend, I love you, I love [your wife]. I pray for you everyday, there is not anything I would not do for you two people”. “By the way” said Norm “I can get you two diamond cores with a diamond in each of them. A nice Christmas present for your daughters, only $800.00 each”. We bought two, I had no receipt book and Norm didn’t either. He said “make it up and I will sign it later”. I made out the receipt still not signed.

50. Between November 21, 1996 and November 26, 1996, Norman was over almost everyday for an hour or so early in the morning or later at night. We do have a job. He would visit Rosemary and also tell her the same stories about the gold mine he managed for a US Mining Concern and the large amounts of cash he handled. This gold mine was in the jungle of Nicaragua, Central America. Norm told us how he raised two Central American tiger cubs, the mother had been killed. Those tigers escaped a circus when they had the rebel Sandanesta uprising in Nicaragua. Norm got out of there when Ortega became president.

51. One morning he came over all excited telling us “it won’t be long now until we will get our shares paid”. Norm said he got a phone call from Toronto that he could pick up the helicopter. Norm said his house sale money would also come in soon and then he could pay us back. He, Norman wanted Rosemary, [my wife] and myself to come along to pick up his helicopter. He said we would get a ride in Diamet’s lear jet when Mr. Eccott had to fly to the B.H.P. Diamet office. Norman said he would like us to meet his family in Ottawa and Sudbury. He said we can pick up the chopper and hop over to Ottawa, then we will stay in Sudbury at Norman’s cabin and the next day we can fly on to Winnipeg, Regina, Calgary and then home. We were all very excited.

52. Norman came in to see us Tuesday, November 26, 1996 telling us it won’t be long now, all the documentation was being done at the accountant’s office. Mr. Eccott told Norman the gold claims were not sufficient to write off our taxes on the Diamet shares. He would give us 25 square miles of new claims in the Yukon for $5,400.00 and received a signed receipt from Norm which can be found at…

53. Norman said he was going to fly over with his jet ranger and stake the claims the first week in January 1997. Norman was gone for a week to inspect his recently purchased jet ranger and go to Diamet’s office and visit his Canada Immigration Executive brother in Ottawa.

54. Norman came to see us on December 5, 1996, telling us that Jim Eccott had problems with the B.H.P. people with the warrant issue of the A, B & C stock they were planning to put on the Toronto Stock Exchange. Mr. Eccott was thinking of buying more stock. Norman said if we could give him $6,000.00, we could get more diamond claims north of Yellowknife.

55. Norm looked us straight in the eyes and said “we don’t have to pay until we get our first diamond shares moneys which was being prepared for us at the accountant’s office”. Norm said Mr. Eccott had gone to Hawaii for a week and would be back on the 11th or 12th of December, 1996, that’s when we will have a meeting with Mr. Eccott’s accountant and the TD Bank manager.

56. On December 12, 1996, a Thursday morning, at approximately 11:00 a.m., the phone rang and [my wife] picked it up and it was Mr. Eccott on the line introducing himself with a very confident voice telling us that he had known Norm for 20 years and that Norman had helped him out financially, and that a friend of Norman’s was a friend of Mr. Eccott. He would like to meet us personally for coffee. [My wife] called me over excitedly as I was working in the lounge down the hallway. I came to the phone and Mr. Eccott introduced himself forcefully and confidently told me he had known Norman for over 20 years and if it would not have been for Norman Graham Armstrong mortgaging his house to help out, I, Mr. Jim Eccott would not have a pot to piss in (these were his exact words). He told me he had just put a brown envelope in the mail from the Kelowna post office and in it were the three grants of $250,000.00 each to [my wife] and me, and the $500,000.00 for Norman. We should have it by Monday, 1st class mail.

57. [My wife] and I were very excited, so Monday or Tuesday we should have the money. Mr. Eccott told us he was going to Toronto to check on the Diamet office and arrange for Norman and I to take a flight on his jet so Norm could pick up his chopper. Norman came in that evening and we told him we had a call from Mr. Eccott telling us he was sorry things had been so slow on the pay out but that he wanted to do it right. Norman said to me “well … ye of little faith, did I not tell you everything was going to come up roses?”

58. On Friday, December 13, 1996, at approximately noon, Norman drives up in his green Toyota Corolla and tells us he is going to buy a 4 wheel drive Pathfinder and told us his money from the house would come in by the 20th of December. Norman said we should put the $6,000.00 I told you about and buy those diamond claims north of Yellowknife. If you and [my wife] give me that $6,000.00 cash, I’ll wire it over to Toronto”. I told Norman I was too busy on Friday and our bank balance was really getting low. Norm said “you can get it tomorrow and then I will come back to pick it up on Sunday evening”. [My wife] and I got the money from the bank of (sic) Saturday, we must have been hypnotized. Sunday evening Norman came to pick up the $6,000.00 cash which he was going to wire to the Diamet office in Toronto. He forgot his receipt book and Norman said “don’t worry, Monday, Tuesday, Wednesday is payday, I love you both”. The receipt can be found ….

59. Norman came bright and early Monday, December 16, 1996 and brought us danishes. We were waiting, full of anticipation for the brown, first class mail envelope with the moneys and documentation. The first class mail never came. Norman acted very disturbed. Tuesday morning, December 17, 1996, Norman told us he went to the main Post Office on Georgia Street and saw the brown envelope, but the Post Office would not give him the envelopes as the address was wrong, 1966 West 19th, instead of 1966 East 19th. He said the Post Office sent it back to Mr. Eccott in Kelowna. Norm could not reach Mr. Eccott as he was in Yellowknife. “Don’t worry”, said Norman as he looked us straight in the eye, “we will get it before Christmas”. On December 19th we had our Christmas dinner for the tenants and 45 attended.

60. Norman got the turkeys and hams wholesale again. Everyone commented what a gentleman he was.

61. I wanted to buy our two son in laws Panasonic camcorders and a camera for myself, Norm and I had talked about the cameras previously. Norman told us he could get the cameras wholesale from the London Drugs Wholesale Representative. Norman had mentioned the wholesale cameras back in September already. I never told him I was buying camcorders before. Norman would check it out. On Friday, Norman came to see us at around noon. He said he could get me the cameras, a Nikon SLR for $750.00 camera and 2 Panasonic camcorders @ $1,100.00 each with top of the line tripods and leather camera bags and zoom lens for the Nikon camera. Norman says give me $2,300.00 and I will have them for you on Monday the 23rd of December - I have no receipt signed by Norman for these.

62. It was Monday, December 23, 1996, no Norman and no cameras. I asked if Rosemary had heard from him and she said no, she had not. The first time I got really angry for Norman for not delivering the cameras, we had no present for our sons in law. On December 24, 1996 we had a small staff party, still no Norm or the cameras. We were going to have our family Christmas dinner at 2:00 p.m. on December 25th.

63. On December 24th, early in the evening, I called Gordon…. whose number Norman had given us as a person who receives phone messages for Norm when he is gone and I got his recording. Gordon called me back soon after and told me Norman was on a rescue mission on the northern tip of Vancouver Island. I was quite upset. On Christmas morning Rosemary had received a call that all was well and Norman would be back soon.

64. On December 25, 1996, we had the worst Christmas ever in memory. Our daughters were very upset with us, still we did not tell them anything except that all would end well. At 3:00 p.m. on December 25th the phone rings at our Sardis home, swish, swish, swish, swish. It was Norman’s voice from his Labrador helicopter from search and rescue, he was calling from Bella Coola, BC. He had another French pilot with him. He explained “he was very sorry but there were lives at stake and there were no other pilots available, so he had to go, don’t worry, I love you both. God bless you and I’ll be back as soon as possible”.

65. Norm did not come back until late Monday evening on December 30, 1996, he was very, very upset. He had no car and of course, no cameras, no camcorders, no diamond cores. He said he had all the stuff in the truck of his car when he left for the rescue mission. He parked the car at a special shed at the helicopter area at the Vancouver Airport, he came back this afternoon and his car was gone. He found out his ex-wife had the sheriff seize his car and her East Indian lawyer had laid claim to all his assets, including the $390,000.00 he got for his Grant Street house, his gold bars he had from Murray Pezim, the gold bars were in the CIBC Bank downtown and the $390,000.00 was in the Vancity Credit Union. They had seized it all.

66. Norm told us he had called his lawyer and said “I want to make a deal with my ex but I can’t get a hearing until January 15, 1997”. He talked to Mr. Eccott and Diamet, they wanted his jet ranger out at Yellowknife but since the Court date was set for the 15th and he had to talk to his lawyers, Norman was going to send his French pilot friend who knows how to fly the helicopter equipment for night flying. The pilot would only take cash, Norman was pleading with us. He told us how sorry he was, but better times would come. We gave him $3,000.00 cash and we were getting low at the bank money wise. A copy …

67. As of December 31, 1996, my wife and I had given Norm Armstrong $53,850.00. Still we had no share certificates.

68. Norman told us he got a call from Yellowknife that he had to go up there right away because the rotor pitch on the helicopter blades was out of balance and they could not get it right, he had to go up there right away. He asked for $2,400.00 cash for his travel and to pay two persons to stake out our claims. He said he had talked to Mr. Eccott about our moneys due from the shares, now Mr. Eccott wanted to buy all our shares and warrants and pay us the full amount.

69. [My wife] and I were getting confused, we gave Norm $2,400.00 cash on January 8, 1997 with no receipt, he would give us the receipt later. I am sure now we were hypnotized.

70. Norman was gone for a week. He said he had parked his helicopter at Kelowna Airport. He came over Monday, January 13, 1997, in the evening. He said he had burned his left hand badly and it meant he could not fly his chopper. He blamed it all on his ex-wife, lousy Muslims, etc., and I had never seen Norm so angry. He said he was in a real bind and he needed $18,000.00 because his ex-wife demanded $25,000.00 cash and $3,000.00 per month for three years to release his assets, car, and my cameras, camcorders, and diamond cores. I said Norman we don’t have any more money at the bank, and I told Norman I am not putting a mortgage on our house and my wife. Norman was pleading “man, [to me and my wife], remember when you asked me what can we do for you way back in September 1996? Just a little while and we will have our share and moneys”. I said could Mr. Eccott give you an advance? Norman said “I don’t want him involved”.

71. I can cry as I write this, dear [my wife] goes out and gets her last savings out of the closet and plunks down $800.00, I go and get my money belt and take out the $500.00 US and gave them to Norman. I took him to the TD Bank at …. to get the remainder to give him $2,700.00 in total. He agreed to pay it back when all was settled. A copy …

72. On January 23, 1997, Norman told us he was going to get his car back and the contents but he needed $1,350.00 because he was short of the $25,000.00 cash payment to his ex. I gave him $1,350.00 on my Visa. Norm said “just keep the record, I will pay you back in February”. We did not get the cameras, nor the diamond cores, as the sheriffs would not release it without the signature of Mr. Eccott due to the nature of the diamond cores. We were getting upset. A copy of the receipt …

73. Norman comes in on Monday, January 27, 1997 and says “…. we need another $1,000.00, I need it quick”. I said “Norman, is your bank not open?” He looked us straight in the eye and said “[you], trust me”. I gave him $1,000 on our Visa card with no receipt. A copy of the Visa receipt can be found…

74. Norman came in on Thursday, January 30 and convinced us to part with another $810.00 put on our Visa with no receipt given. Norman told us he was flying to see Mr. Eccott in Edmonton and Mr. Eccott decided to pay us out completely.

75. He told us that Mr. Eccott had moved his bank account to Edmonton because Provincial income tax is much lower in Alberta than BC, he had also moved his office and was going to buy a house in Edmonton.

76. Norman told us was going to Edmonton February 3, 1997. He phoned us at least twice a week and said “all is well, God loves you”. By the 20th of February we really started to get worried. The credit cards were at their maximums, we got calls to pay up.

77. Norman called us on February 28, 1997 to tell us he had everything, the cameras, the diamond cores, the stock certificates, receipts, documents of sales transactions, everything. He sounded very excited. We were very distressed, and I told Norman we were getting calls from credit card companies and needed some cash desperately. Norman said “give me your bank account numbers, I will get Jim Eccott to put $5,000.00 in each account, I will wire it March 3, 1997”. There was no money put in our accounts on March 3, 1997. I said to [my wife], “I don’t know anymore”. By the end of February 1997, we had given Norman a total of $64,060.00

78. Norman phoned us almost every day the first week in March that he was in Kelowna doing some work for Mr. Eccott and he was coming in with all the moneys and everything.

79. He sounded so convincing. The last time he called me from Kelowna on March 6, I asked him to just pay us back the $70,000.00 we invested. He said “…. you are my best friend, trust me. Its all here, almost $1.8 million. I am coming in with Jim Eccott on Monday, March 10, 1997, it might be in the afternoon, don’t worry. I am coming for sure”. Norman did not come. On Tuesday, March 11, 1997, I asked Rosemary if she had heard anything from Norman. I phoned Gordon… but Gordon was not in so I left a message telling Norman to please call us collect.

80. We got a call from Norman on March 13, 1997 at 9:00 a.m., he was very distressed and still convincing. “…. I love you both, you don’t know what happened to me. I was on my way to bring you the moneys, etc., I had Jim Eccott with me, we got a call from the RCMP in Kamloops to land immediately. They searched my helicopter for drugs. You know the person that tipped them off was Rosemary and some legion lawyer. Norm told us that Mr. Eccott was very upset and put all the moneys, grants, documents, etc., in his office vault in Edmonton.

81. Norm told us that Mr. Eccott had to go to Toronto for a week, he told Norm he was very upset to get involved with Norm’s problems and said just keep everything in my bank vault until I get back next week”. Norm said, “you know the legion lawyers froze all my assets again, oh boy what trouble I am in. I’ve got no money, I am hungry, Mr. Eccott is mad at me, so I did not want to ask him for cash. [My wife] and Fred, please wire me $500.00 today to the Edmonton Center Mall at the TD Bank there”. I said to [my wife], I think he is scamming us. [My wife] said send him the money, we will have proof with the receipt from the bank and really find out if he is indeed in Edmonton. A copy of the bank records can be found …

82. Norman was in Edmonton, he did pick up the money at the Edmonton Center Mall. We had a week’s holiday and went to Chilliwack, we were very unhappy. My dad’s 95th birthday was coming up March 18, 1997. [My wife] was preparing cakes and cookies, etc. I did phone Gordon …. but only his answering machine was on so I hung up.

83. On Sunday, March 16, 1997 at 10:00 a.m. we got a call from Norman again telling us that he had been in contact with Mr. Eccott in Toronto and that Mr. Eccott and Norm would fly from Edmonton to Kamloops March 20, 1997 and he would bring all the moneys and documentation with him, including the camera equipment. They would take the helicopter from Kamloops Airport and fly to Chilliwack and meet us at our home. I will phone ahead he said. Norman also said “I do have a problem, they stole my parka and my wallet at the motel, I am cold and hungry and I can’t stand it any longer, I need $400.00”. I wired him $400.00 to the TD Bank West Edmonton Mall. A copy of the bank records can be found at ….. Norman picked it up, called us back that he for sure was coming on Thursday, March 20, 1997.

84. Norman did not come on Thursday, March 20, 1997. We were really worried now. I phoned Gordon … to please call us collect if he had heard anything from Norman. Norman did not phone on Friday. Friday at noon I started calling for information to a Mr. James Eccott, unlisted number. The operator gave me the phone number which was not listed. I could not get through to the Eccotts.

85. Saturday I tried again at 9:00 a.m. and I got a lady on the Eccott’s house phone, she noted my urgency and called Mrs. Shirley Eccott in Vancouver. Mrs. Eccott called me back and told me her husband was not a geologist, but President of Diamet office in Kelowna. They did not know of Norman Armstrong as a pilot, or a person selling Diamet shares from their office. She told me I should check with the Diamet office on Monday, March 24, 1997.

86. On Monday morning I phoned the Diamet office and there was a file on Mr. Norman Graham Armstrong. I talked with the police fraud investigation, they were very helpful.

87. The pain and suffering caused by Mr. Armstrong is almost too much to bear on my dear wife and I. I feel terribly guilty, foolish and embarrassed. I can’t look my children in the eye. We had to change our bank account numbers and make sure a fraud artist can’t get what we have left. I feel terribly stupid. If only I had made one phone call that fateful day in July and August of 1996. That phone call to the Eccott’s house or to the Diamet office in Kelowna.

88. … I cannot believe that Norman Armstrong was so cunning in his manipulation of my wife and me. His stories were all so real. We wanted to help him when he said he needed help and now we know he completely betrayed us.

89. In total, my wife and I gave Norman Armstrong over $65,000.00 of our savings.

Sections 50(1)(b) and(d) of the Act reads as follows:

50 (1) A person, while engaging in investor relations activities or with the intention of effecting a trade in a security, must not do any of the following:
(a) …
(b) give an undertaking relating to the future value or price of the security;
(c) …
(d) make a statement that the person knows, or ought reasonably to know, is a misrepresentation.

Section 57(b) and(c) of the Act reads:

57. A person must not, directly or indirectly, engage in or participate in a transaction or scheme relating to a trade in or acquisition of a security or a trade in an exchange contract if the person knows, or ought reasonably to know, that the transaction or scheme
(a) …
(b) perpetrates a fraud on any person in British Columbia, or
(c) perpetrates a fraud on any person anywhere in connection with
(i) the securities of a reporting issuer, or
(ii) trading in exchange contracts on an exchange in British Columbia.

Armstrong’s representations to the retired couple included the following:

“Misrepresentation” is defined in section 1(1) of the Act to mean:

(a) an untrue statement of a material fact, or
(b) an omission to state a material fact that is
(i) required to be stated, or
(ii) necessary to prevent a statement that is made from being false or misleading in the circumstances in which it was made.

“Material fact” is also defined in section 1(1) of the Act to mean:

where used in relation to securities issued or proposed to be issued, a fact that significantly affects, or could reasonably be expected to significantly affect, the market price or value of those securities.

However, we find that Armstrong contravened section 50(1)(b) of the Act when he represented:

1. under section 161(1)(c) of the Act, that all of the exemptions described in sections 44 to 47, 74, 75, 98 or 99 of the Act do not apply to Armstrong for the rest of his natural life;

2. under section 161(1)(d) of the Act, that Armstrong is prohibited from becoming or acting as a director or officer of any issuer and is prohibited from engaging in investor relations activities for the rest of his natural life;

3. under section 162 of the Act, that Armstrong pay an administrative penalty of $100,000; and

4. under sections 150 and 174 of the Act, that Armstrong pay the prescribed fees or charges for the costs of or related to the investigation and hearing incurred by the Commission and the Executive Director.

A registrant holds a special position in the securities market and regulatory system. Subject to certain exemptions, trading in securities can only be done by or through a registered dealer. A registered salesman of a dealer is required to meet educational requirements and to conduct business in accordance with regulatory standards. The purpose of the registration requirement in the Act has been described as follows by the Supreme Court of Canada in Gregory & Co. v. Quebec Securities Commission, [1961] S.C.R. 584, where Fauteux J. observed at p. 588:

The paramount object of the Act is to ensure that persons who, in the province, carry on the business of trading in securities or acting as investment counsel, shall be honest and of good repute and, in this way, to protect the public, in the province or elsewhere, from being defrauded as a result of certain activities ...

	Joan L. Brockman
	Member