Pigeon King sentenced to more than seven years

Monday, March 17, 2014

UPDATED: Wed. Mar. 19, 2014

by BETTER FARMING STAFF

Former Pigeon King International owner Arlan Galbraith was sentenced in a Superior Court of Justice in Kitchener today to seven years plus three and a half months in a federal prison for fraud over $5,000. Galbraith is being credited for three and a half months of time served since he was found guilty in December 2013 and will serve the remainder seven years.

Justice G. E. Taylor noted the defendant showed no remorse, made no apology and there was no possibility of restitution by the 66-year-old defendant. Just before sentencing, Gabraith declined the judge’s invitation to address the court and sat silently showing no emotion while the judge pronounced sentence.

The judge found that the fraud totaled more than $40 million. The judge also noted the sentence was intended to denounce Galbraith’s actions and deter others.

Galbraith had no prior convictions or addictions to drugs or alcohol and this pointed in favour of a lighter sentence. The devastating effect that his actions had on victims were factors favouring a tougher sentence.

The judge agreed with both Crown and defence counsel that a restitution order was inappropriate. Crown and defence agreed that there was little likelihood that Galbraith had the ability to pay back significant amounts. They also agreed that most, if any amounts collected on behalf of victims would end up being paid as fees to the bankruptcy trustee.

Justice Taylor found there “never was an end market of any kind” for the birds Galbraith sold to investors. At the time of the bankruptcy, Galbraith and his venture owed approximately $356 million. Had the venture, which the judge described as “a pyramid” continued, there would “not be enough purchasers in the world” to buy all of his production. Crown attorney Lynn Robinson asked the judge to impose a nine to 12-year sentence, noting the current maximum sentence for fraud over $5,000 is 14 years.

Defence lawyer David North, who began representing Galbraith a few weeks ago, asked for a three- to four-year sentence. He argued that Galbraith was “a 66-year-old gentleman with no prior convictions who has spent his life outdoors.” He said Galbraith “suffered when his first marriage fell apart when his first wife became a paraplegic,” and he said that Galbraith is a cancer survivor. The court heard that Galbraith has lost “30 to 40 pounds” during his three and a half months in jail awaiting sentencing and has been “humiliated and diminished.”

Bill Top, Edmonton Alberta, a former Pigeon King salesman, was the only witness to give evidence during the sentencing. He testified that Galbraith had targeted Amish, Mennonites and Hutterites in the scheme. He recalled a conversation where Galbraith laughed about making money from these groups which Top said Galbraith referred to as “aliens.”

Crown attorney Robinson termed preying on these groups as “affinity fraud.”

North disputed there were any attempts to target these groups. The judge agreed with North. Had he found these groups were targeted, it could have increased the sentence.

North, a Toronto criminal lawyer, would not say how he came to represent Galbraith, who earlier defended himself before a judge and jury. “I came in at the eleventh hour.”

“I am happy it’s over,” Robinson said. “I’m disappointed there is no restitution.”

Two officers from the Waterloo Regional Police Service, and two RCMP officers were present for the sentencing, along with three jurors from Galbraith’s trial, a number of witnesses and a handful of former investors.

Robinson gave credit to the police officers for their hard work developing the case which convicted Galbraith. She noted that, like Galbraith, fraudsters are typically over 40 with no prior convictions and a good reputation in their communities. BF

UPDATE: Wed. March 19, 2014

Galbraith was also convicted on two counts under the Bankruptcy and Insolvency Act. On one count, obtaining money by false representation, the judge issued a conditional stay. Crown attorney Lynn Robinson explains the charge is essentially the same as the first count of fraud under the Criminal Act, although more limited in scope. If Galbraith successfully appeals the first conviction, the count under the Bankruptcy and Insolvency Act would automatically revive, and he’d have to appeal that conviction as well.

Galbraith also received 30 days concurrent in jail on the other count under the bankruptcy legislation, which involved failing to attend a creditors meeting following his bankruptcy.

There was also a mandatory victim surcharge of $100.

Robinson says Galbraith has 90 days to file an appeal of both the conviction and sentencing. The appeal period began yesterday.  BF