Canada to Crack Down on White Collar Crime
Minimum Sentences and Tougher Parole Eligibility Planned
Oct 21, 2009
In the latest installment of the Conservative government’s tough-on-crime proposals, Justice Minister Rob Nicholson has tabled new legislative changes dealing with white-collar crime. Anyone who is convicted of a fraud that exceeds $1 million will face a mandatory minimum sentence of 2 years in the penitentiary.
In addition, judges will be given a formal set of aggravating factors that must be taken into account on sentencing. These include consideration of the degree of planning involved, the complexity and duration of the fraudulent conduct and the financial and psychological impact that the fraud has had on the victims. Judges will also be given powers to order that convicted fraudsters make restitution to their victims and to bar offenders from ever again handling other people’s money.
In addition to these criminal law changes, Public Safety Minister Peter Van Loan is looking at changing the Corrections and Conditional Release Act to deny white collar-criminals access to the current provision that allows non-violent inmates to be paroled after serving just one-sixth of their sentence.
Are the Proposed Changes Substantive?
Eric Gottardi, a member of the criminal law section of the Canadian Bar Association, criticized the proposals as not really making substantive changes. The Vancouver lawyer pointed out that those who are now convicted of frauds that exceed $1 million face serious jail time that can exceed the proposed minimum of two years. And judges currently take into account aggravating (as well as mitigating) factors into account when sentencing a person who has been convicted of a white-collar crime. Judges now consider circumstances such as the effect that the fraud has on its victims, the amount taken and complexity and duration of the accused’s conduct.
Mandatory Minimum Sentences
Mandatory minimum sentences that are currently in place have been subject to criticism. These mandatory sentences can certainly prevent further crimes from being committed if the offender is in jail and not out on the street. But there is no evidence to suggest that mandatory minimum sentences deter others from committing the same crime.
If people are not deterred by the possibility of getting caught and sent to jail now they are unlikely to be stopped by the thought of having to serve a two year minimum sentence. And those who are convicted of serious financial frauds like Ponzi schemes are not likely to repeat their offences if for no other reason than people will stop willingly handing over their money to be “invested”.
Mandatory minimum sentences often end up becoming the maximum, or at least the standard sentence. Judges who now would give more time to someone who perpetrates a million dollar fraud will end up imposing the minimum.
Earl Jones
White-collar crime received a lot of attention in Canada since the summer due to arrests in two large Ponzi schemes. Two Alberta men were arrested and police believe they may have swindled 3,000 people and the losses could reach $400 million. But what has garnered most media attention was the arrest last summer of Earl Jones of Montreal.
Jones, 67, who is often referred to as the Canadian Bernie Madoff began working at Montreal Trust where he handled estates and trusts. For more than 20 years he operated a number of companies; his recent one being Earl Jones Corporation, where he invested his clients’ money in what appeared to be good investments.
Earl Jones was appeared to be the pillar of his Quebec community. He married his childhood sweetheart, had lots of friends, a nice home and seemed to lead an unblemished life. He was described by some who knew him as charming, generous and a devoted family man. Many small children affectionately called him “Uncle Earl”. Earl Jones was someone you could trust and many people did trust him; by handing over huge amounts of money, sometimes their life savings, for him to invest.
Jones’ clients were pretty happy when they were receiving monthly cheques that gave them a high rate of return on their investments. But suddenly last summer the cheques either stopped coming or bounced. And Uncle Earl was nowhere to be found. In a brief period of time, everything came crashing down.
Earl Jones surrendered to the police on July 27, 2009 and was released the next day on $30,000 bail. He was charged with fraud, conducting a Ponzi scheme in which approximately 130 investors were defrauded of over $50 million.
Much of the publicity surrounding Earl Jones resulted from the many of the alleged victims of his frauds who quickly organized themselves in an attempt to try and get their money back. And the later arrests of two Alberta men alleged to be involved in a similar Ponzi scheme show that the crime that Earl Jones is alleged to have committed is far from an isolated occurrence in Canada.
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