R. v. Fast (R.J.), (2015) 460 Sask.R. 90 (CA)

• Judge: Richards, C.J.S., Herauf and Whitmore, JJ.A.
• Court: Court of Appeal (Saskatchewan)
• Case Date: June 01, 2015
• Jurisdiction: Saskatchewan
• Citations: (2015), 460 Sask.R. 90 (CA);2015 SKCA 56

R. v. Fast (R.J.) (2015), 460 Sask.R. 90 (CA);

    639 W.A.C. 90

MLB headnote and full text

Temp. Cite: [2015] Sask.R. TBEd. JN.018

Ronald Jerry Fast (appellant) v. Her Majesty the Queen (respondent)

(CACR2462; 2015 SKCA 56)

Indexed As: R. v. Fast (R.J.)

Saskatchewan Court of Appeal

Richards, C.J.S., Herauf and Whitmore, JJ.A.

June 1, 2015.

Summary:

The accused father and daughter were involved with a company owned by the father (Marathon) that allegedly defrauded investors by operating as a Ponzi scheme. Investors were given promissory notes with high interest rates. As revenues were insufficient to pay interest, initial investors were paid from monies provided by subsequent investors. As a result, Marathon's deficit increased over the relevant years (2005 to 2008) until it went bankrupt because it could no longer access investor monies. Almost $17 million was owed to the unsecured investors. Investors were denied access to financial statements. The limited financial information provided was misleading and hid actual financial performance. When the Saskatchewan Securities Commission ordered that Marathon cease receiving monies from investors, related companies (including one co-owned by the daughter) acted as conduits to funnel needed investor funds to Marathon. Investors were not told of the securities investigation or Marathon's insolvency. The accused were charged with fraud (Criminal Code, s. 380(1)(a)), making false statements respecting Marathon's financial status with intent to enter a security for Marathon's benefit (s. 400(1)(c)(ii)) and possession of the proceeds of crime (ss. 354(1)(a) and 355(a)). The father pleaded guilty to all three counts. The daughter pleaded not guilty.

The Saskatchewan Court of Queen's Bench, in a judgment reported (2014), 441 Sask.R. 23, found the daughter guilty of fraud and making false statements. She was acquitted on the charge of possession of the proceeds of crime. Both the father and daughter sought conditional sentences.

The Saskatchewan Court of Queen's Bench, in a judgment reported (2014), 441 Sask.R. 23, sentenced the father to seven years' imprisonment for each offence (concurrent) and restitution in the amount of $16,742,441.12. The daughter was sentenced to 30 months' imprisonment for fraud and restitution in the amount of $1,000,000. The father appealed against sentence, arguing that his deteriorating health since sentencing resulted in a conditional sentence now being appropriate.

The Saskatchewan Court of Appeal dismissed the appeal.

Criminal Law - Topic 5720.4

Punishments (sentence) - Conditional sentence - When available or appropriate - [See Criminal Law - Topic 5859 ].

Criminal Law - Topic 5841

Sentencing - Considerations on imposing sentence - Age of accused - [See Criminal Law - Topic 5859 ].

Criminal Law - Topic 5848.3

Sentencing - Considerations on imposing sentence - Medical - [See Criminal Law - Topic 5859 ].

Criminal Law - Topic 5859

Sentence - Fraud - The accused father and daughter were involved with a company owned by the father (Marathon) that defrauded approximately 250 unsecured investors of $17 million by operating a Ponzi scheme over a number of years - Investors were given promissory notes with high interest rates - As revenues were insufficient to pay interest, initial investors were paid from monies provided by subsequent investors - As a result, Marathon's deficit increased over the relevant years (2005 to 2008) until it went bankrupt because it could no longer access investor monies - Investors were denied access to financial statements - The limited financial information provided was misleading and hid actual financial performance - When the Saskatchewan Securities Commission ordered that Marathon cease receiving monies from investors, related companies (including one co-owned by the daughter) acted as conduits to funnel needed investor funds to Marathon - The father pleaded guilty to fraud, making false statements respecting Marathon's financial status with intent to enter a security for Marathon's benefit, and possession of the proceeds of crime - The 71 year old father was not remorseful - He continued to defend his business and his daughter - He had significant mental and physical health problems, including morbid obesity, diabetes and depression - Aggravating factors included the magnitude of the fraud (one of the largest in Saskatchewan history), the breach of trust and his use of the monies to fund his lifestyle - The average age of the investors was over 70 and most were financially and emotionally devastated - Neither attempted restitution out of personal funds, nor did they present a realistic plan for restitution - The trial judge rejected conditional sentences as inappropriate - Denunciation and deterrence were the primary sentencing factors - The father was sentenced to seven years' imprisonment for each offence (concurrent) and restitution in the amount of $16,742,441.12 - The father appealed, arguing that his deteriorating health since being sentenced warranted a conditional sentence - The Saskatchewan Court of Appeal dismissed the appeal - The trial judge properly considered the father's health when imposing sentence - The seven year sentences fell within the range of sentences imposed on similar offenders committing similar offences - The penitentiary had a well-equipped medical unit capable of looking after the father's medical needs - An accused's ill health, although a factor to be considered, "does not necessarily mean that every ill offender or aged offender is entitled to a lesser sentence than would otherwise be imposed" - The sentence was not excessive or demonstrably unfit - If the father's health posed an increased health risk to him, he could apply for parole under ss. 102 and 121(1) of the Corrections and Conditional Release Act (exceptional cases) - See paragraphs 1 to 18.

Criminal Law - Topic 5897

Sentence - False statements (Code, Income Tax Act, etc.) - [See Criminal Law - Topic 5859 ].

Criminal Law - Topic 5972

Sentence - Money laundering or proceeds of crime - [See Criminal Law - Topic 5859 ].

Cases Noticed:

R. v. Proulx (J.K.D.), [2000] 1 S.C.R. 61; 249 N.R. 201; 142 Man.R.(2d) 161; 212 W.A.C. 161, refd to. [para. 7].

R. v. Bethke (D.) (2013), 427 Sask.R. 135; 591 W.A.C. 135; 2013 SKCA 135, refd to. [para. 13].

R. v. Harding (R.E.) (2006), 285 Sask.R. 273; 378 W.A.C. 273; 2006 SKCA 118, refd to. [para. 14].

R. v. Shropshire (M.T.), [1995] 4 S.C.R. 227; 188 N.R. 284; 65 B.C.A.C. 37; 106 W.A.C. 37, refd to. [para. 15].

R. v. C.A.M., [1996] 1 S.C.R. 500; 194 N.R. 321; 73 B.C.A.C. 81; 120 W.A.C. 81, refd to. [para. 15].

R. v. Vanoirschot (L.P.J.) (2006), 289 Sask.R. 63; 382 W.A.C. 63; 2006 SKCA 130, refd to. [para. 16].

R. v. P.H.L.W. (2005), 279 Sask.R. 266; 372 W.A.C. 266; 2005 SKCA 156, refd to. [para. 16].

Statutes Noticed:

Corrections and Conditional Release Act, S.C. 1992, c. 20, sect. 102, sect. 121(1) [para. 18].

Counsel:

Morris P. Bodnar, Q.C., for the appellant;

Andrew S. Davis, for the respondent.

This appeal was heard on March 27, 2015, before Richards, C.J.S., Herauf and Whitmore, JJ.A., of the Saskatchewan Court of Appeal.

On June 1, 2015, Whitmore, J.A., delivered the following judgment for the Court.