Accused Ont. fraudster in court

Thirteen Toronto area men accused of fraudulently securing $4 million in small business bank loans over an eight-year period will return to court next month. Together, the men face a total of 64 fraud-related charges, many of which are offences under the Canada Small Business Financing Act, while the remaining are fraud counts over $5,000 under the Criminal Code….If convicted, the men could face fines of up to $500,000 and up to 10 years in prison.

http://www.canada.com
October 29, 2010

Accused Ont. fraudster in court
Linda Nguyen

BRAMPTON, Ont. - Thirteen Toronto area men accused of fraudulently securing $4 million in small business bank loans over an eight-year period will return to court next month.

Together, the men face a total of 64 fraud-related charges, many of which are offences under the Canada Small Business Financing Act, while the remaining are fraud counts over $5,000 under the Criminal Code.

Five of the men appeared with their lawyers in a crowded Brampton courtroom Friday to schedule a joint disclosure hearing for Nov. 26. None of the accused or their counsel agreed to speak to media.

Notably absent was David Scenna, 38, who faces 22 of the charges and who the RCMP allege was the leader in the multimillion-dollar fraud scheme.

Scenna, of no fixed address, is accused of using false documents, reports or information to obtain multiple small business loans of $250,000 from banks between 2001 to 2008. Police allege the money was used for personal purchases and not for businesses purposes.

Documents were also submitted for fake purchased equipment and property leases were then submitted, according to the RCMP.

A Toronto newspaper reported this week that the money - a total of $4 million - was used to pay for lavish parties, expensive cars, prostitutes and alcohol.

When the money ran out, Scenna allegedly went to other banks to secure more loans and was approved despite having a bad credit history and defaulting on his loans, according to the newspaper.

The RCMP were first alerted of the fraud by Industry Canada after the agency received a number of claims in 2007 and 2008 by the banks where the men defaulted on their loans. Taxpayers' money is usually given to banks for unpaid loans.

Police initiated a two-year investigation in 2008, which included executing search warrants for 50 bank accounts. Investigators say after looking through thousands of documents, they have discovered a “paper trail” for each count of fraud. The accused were arrested in September.

If convicted, the men could face fines of up to $500,000 and up to 10 years in prison.

Brampton is 40 kilometres west of Toronto.

linnguyen(at)canwest.com

twitter.com/lindathu(underscore)nguyen

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