Three Alberta men are facing charges in an alleged Ponzi scheme that has bilked an estimated $60 million from over 1,000 North American investors.
The RCMP commercial crime section has concluded after a six-year investigation that three Calgary area men tied to the company HMS Financial provided a series of investments between 2001 and 2004 that were alleged to offer investors an return of between eight and 12 per cent per month.
Investors were told that their investment was risk free, alleging that they were advised that Garth Bailey, HMS Financials lawyer, held bonds valued in the millions of dollars which would be liquidated should the investments fail to pay out, according to police.
According to the RCMP, Investigators have not been able to identify the existence of any bonds and believe this high yield investment program was a Ponzi Scheme.??It is alleged that in order to perpetuate the scheme and entice new investors HMS Financial paid 10 per cent a month every quarter to those investors who chose to accept a quarterly payout of interest. The payments are believed to have been drawn from funds provided by other HMS clientele, police say.??Investigators believe the investment program operated by HMS Financial failed in March 2004 when HMS Financial could not meet their payout obligations. HMS Financial collapsed just as the RCMP investigation began.
(Harold) Murray Stark, 73 of Three Hills, Alta., Robert Fyn, aka Robbie Fyn of Linden, Alta., and Garth S. Bailey, 57 of Okotoks have been charged with fraud over $5,000, conspiracy to commit fraud and laundering charges.
Katherine Rodrique Bailey, 53 of Okotoks was also charged with the laundering charges.
