Thursday, December 5, 2013

Galbraith judged guilty of fraud

Arlan Galbraith has gone straight to prison after a jury of six men and six women returned guilty verdicts today.

Crown attorney Lynne Robinson said she will ask Justice Gerry Taylor to sentence him to nine years for defrauding hundreds of investors who bought breeding pairs of pigeons from Galbraith and his Pigeon King International Inc. business in Waterloo.

Fraud was the most serious charge; he was also found guilty of two charges of contravening the Bankruptcy Act.

Galbraith will be back in court Thurs., Dec. 12, for a bail hearing, seeking release until his sentencing hearing.

Justice Taylor lectured Galbraith yet again, reminding him that he was repeatedly advised to hire a lawyer. Galbraith defended himself, but chose not to testify.

Robinson introduced evidence and witnesses to demonstrate that Galbraith defrauded investors of about $20 million through contracts he signed promising via five and 10-year contracts to buy back about $320 million worth of pigeons.

He told the original investors he could afford to pay up to $50 per breeding pair of pigeons they raised because he could sell them to people who keep pigeons as a hobby or to race.

Later he told investors he intended to “upgrade” the birds via cross-breeding to raise meat birds and said he planned to open the first of four pigeon-processing plants near Cochrane by 2011.

A forensic accountant testified that Galbraith would have needed to raise $167 million to pay existing contract holders during the three years it would take to get the $6.4-million plant up and running and said to raise that money, he would need to sign up more contracts that would obligate him to pay out $1.5 billion.

In other words, the venture was bound to collapse.

Galbraith maintained throughout that the business, albeit risky, would work and that it collapsed because staff betrayed him and “viscious” news media reporting undermined customer confidence.