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    Rainbow Investigations
    513-18th Avenue SW
    Calgary, Alberta
    T2S 0C6


    Better Business Bureau of Southern Alberta

    Phoney Female Loan Broker Finally Convicted

    One of Alberta’s more notorious consumer scam artists finally appears to be getting closer to being penalized.

    A fraudulent loan broker has been involved with questionable financial services businesses of one sort or another in Alberta since at least 1999. She would use a variety of aliases, portray that she had numerous employees, and had her hand in numerous reserved business trade names.

    Most prominently though, through the years of 2004 to early 2007, she portrayed herself as a fake mortgage broker, and was the principal behind a business called SBC Alliance Capital.

    In early 2007 the loan broker was finally arrested and charged with over 110 charges involving at least 56 victims. The loan broker would typically take out advertisements in small community newspapers throughout Western Canada, offering to provide mortgage brokerage services to arrange financing for entrepreneurs who may have credit problems elsewhere.

    Victims would typically pay her anywhere from $2,000 to $5,000, to provide the financing service, with no one receiving any of the promised financing.

    In February of 2008, the former loan broker pleaded guilty to one charge of fraud over $5,000 (the 110+ information’s were combined into one charge of fraud).

    In early 2006, one of our clients successfully sued the loan broker in Provincial Court in a northern Alberta Distict. This appears to be the only victim to have done so at this point. As we assisted our client through that process, we learned all about how the loan broker operated her scam.

    According to Provincial Court Judge Lamoureux, final sentencing may not take place until August of 2008.

    Here is the most recent Calgary Herald report on the matter:

    "Victims of a Calgary woman who took tens of thousands of dollars in illegal fees for bogus loans are hoping her guilty plea will help them get some of their money back.

    [The loan broker] recently pleaded guilty to one count of fraud over $5,000 for scamming 60 people out of nearly $75,000 between 2004 and 2006. [The loan broker] operated several companies that charged clients a fee to arrange a loan, but the customers never got the money they were promised.

    A probe by police and government regulators uncovered victims in Alberta, Manitoba, B.C. and Ontario who paid fees to six companies: FAC Business Management, SBC Alliance Capital, CFA Business Solutions, MCR Allied Capital, AABAC Financial Services and MDS Corporate Finance Group.

    Corporate registry searches done by the Herald showed all six corporations were controlled by [the loan broker]. Two former employees of AABAC pleaded guilty last year to violating the province's Fair Trading Act, which forbids charging upfront fees for loans, and were ordered to pay $33,000 in restitution to seven victims.

    Investigators said many of the victims turned to the companies because they had poor credit histories and wouldn't have been able to get loans through established lenders such as banks.

    That was the case when Barber and his cousin, Rob Bears, turned to one of the loan broker's companies in 2005. Bears, 32, applied for a $100,000 loan to buy his own rig; Barber, who owned his own truck, applied for a $170,000 loan to pay for a new one. Both paid hefty upfront fees and were "approved" for loans -- but never saw a cent. It was even worse for Barber, who had sold his rig in anticipation of getting his loan. Barber, 33, was forced to sell a motorbike and other possessions to keep his family financially afloat while waiting in vain for the money he was promised.

    Barber has his own rig now, but time hasn't dulled his anger [towards the loan broker]. "To look someone in the eye and lie like that," he said.

    The maximum sentence is 14 years for fraud over $5,000, but the Criminal Code also permits conditional sentences that don't carry jail time. The Criminal Code also allows judges to consider a large number of victims as an aggravating factor when passing sentence, but Barber said he believes [the loan broker] will get off lightly. "She's not going to get what she deserves," he said."

    Date of Story: Wednesday, April 30, 2008
    Story Posted By: Ron Reinhold (amended version)
    Source: Ron Reinhold/Calgary Herald

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