Two of the three men and one women alleged to be involved in an alleged Ponzi scheme with roots in the Three Hills and Linden area have pleaded guilty and received stiff sentences.
    In late November Murray Stark, 74, of Three Hills pleaded guilty to fraud over $5,000 and was sentenced to six years in prison. On December 1 Robert Fyn, 64, of Linden, identified as taking the lead role in the scheme, pleaded guilty to the same charge and was sentenced to eight years, by way of a joint submission.
    Crown prosecutor Peter Mackenzie said the amount of money involved was in the area of $40 million, and could have involved in the area of 1,000 investors.
    “We had on our witness list about 100 lay witnesses, and those people were typically called aggregators, so they would represent a number of investors, and they would have put money together,” said Mackenzie. “Without overestimating, the number exceeds 1,000, in my respectful view.”
    On March 29, 2010 charges that included fraud over $5,000, and conspiracy to commit fraud were levied against Stark, Fyn and Garth Bailey of Okotoks. In addition, the three and Katherine Rodrique Bailey of Okotoks were charged with laundering the proceeds of crime and conspiracy to launder the proceeds of crime.
    Garth Bailey is scheduled to appear in court in February.
    The RCMP Calgary Commercial Crimes section investigated allegations of investment fraud and money laundering relating to an Alberta investment company called HMS Financial Inc. Investigators believed the company was involved in a series of investments between 2001 and 2004 that were believed to be part of a Ponzi scheme.
    “This unravelled because some American authorities seized a large amount… a little more than $6 million U.S. that had been sent to an American attorney in California, and that is what triggered it to come down,” said Mackenzie.
    According to a National Post report, investors were offered high yield returns in the area of 12 per cent, compounded quarterly, and claimed the funds were protected by a bond in trust. Some of the funds were invested in high yield investments programs that turned out to be another separate investment fraud.
    The initial court appearances began in Drumheller but the venue was moved because they were not able to schedule the continuous sitting days at the provincial court house in the valley.
    Mackenzie said in both cases there was no restitution order put in place, meaning restitution is to take place through civil action.

    The answer for schools realizing reasonable electrical bills may be blowing in the wind.
    The Alberta Schools Commodity Purchasing Consortium is looking to participate in a wind power project that could supply its power needs for the next 25 years at a fixed price.
    The Alberta Schools Commodity Purchasing Consortium was created in 2006 with 41 school divisions on board to help reduce the risk associated with the fluctuation of energy prices. They are exploring participating in a wind generation project to continue its goals.
    “Since we have been together… we believe we have produced cost savings of $20-$25 million. Basically what it is all about is to keep as many dollars as possible in the classroom. The less we pay for energy, the more dollars available for classroom instruction.”
    At the December 14 meeting of the Prairie Land Regional Division, the board signed a letter of intent with Consortium for a long-term commitment for the purchase of electricity. Gagnon said Christ the Redeemer School Division and Golden Hills School Division have also shown interest in the project.
    The Consortium selected BluEarth Renewables to be the lead developer of a wind power project. The proposed project would be built in East Central Alberta and plans are that it has a capacity of 70 megawatts.
    The project has an expected capital cost of about $160 million.
    He explains that in Alberta growth has spurred the demand for more electrical generation, while at the same time much of the generation capabilities are at the end of their lifespan and will have to be replaced.
     “Obviously that is going to be expensive to replace because we are using generation that has been in place for many years. That cost is going to be passed to the consumer. The projections for electricity prices is to go up in the foreseeable future,” said Gagnon. “What we are looking at is to work with the developer to build a fit-for-purpose wind project, basically a wind power project that would be built to meet the needs of the school districts.”
    He says there have been a number of factors that have gone into the project. Wind generation technology has changed in the last few years and costs have dropped. Wind generation is also consistent with school consumption. For example, schools use more energy in the daytime and in the winter, the same times that wind generators operate at their peak.
    He adds that in having the long-term commitments from school boards, it lowers the risk for the project, making it more reasonable for the developer to achieve favourable financing.
    “By signing a power agreement, you allow the developer to develop the project because he knows he has a consumer for the next 25 years,” said Gagnon. “It allows the developer to get the financing available…and all that saving is passed on to the school districts.”
    He said this kind of project could amount to a great savings for schools.
    “This project is sustainable from a cost point of view, and actually we believe it will give us lower costs as far as power is concerned for the next 25 years,” said Gagnon. “We are also protecting ourselves from the future rise of electrical prices.”
    He adds, the school divisions have the option of investing up to a 25 per cent stake in the project, thereby possibly getting a return on its investment.
    The project has the potential to have curriculum benefits.
    “From the school point of view it is showing sustainability on the environmental front and showing our students they can do something about the environment like the school divisions. We are leading by example and also reducing the carbon footprint for school districts,” said Gagnon.