Police acknowledge 'oversight' in Pigeon King investigation

Thursday, October 1, 2009

© AgMedia Inc.

by BETTER FARMING STAFF

A former Pigeon King International Inc. contract breeder has been wondering why the Waterloo Police Service’s fraud squad wants her to file a complaint — again – until she learned today there had been a mistake.

“We’ve submitted sworn affidavits, we’ve submitted everything possible and then a week ago Monday (Sept. 21) I get a letter that . . . wanted to know if we’d be interested in submitting a complaint,” fumed Jolene Humbert of Republic, Ohio on Wednesday.

Humbert and her husband, Aaron, are among 50 former U.S. breeders trying to recoup their losses after Waterloo-based PKI folded in June 2008. The company sold pigeon breeding pairs for as much as $500 and bought back offspring for up to $50 each. Its collapse left nearly 1,000 breeders in Canada and the United States with thousands of worthless pigeons and debts estimated to total nearly $39 million.

PKI founder and CEO Arlan Galbraith has strongly denied any wrongdoing. Several months before placing his company in bankruptcy he had preliminary plans drawn up for an abattoir to process the birds for meat. Despite allegations by former breeders and regulatory action by four U.S. states, no official Canadian government agency or regulatory body has ever said there was anything illegal about Galbraith’s activities.

The Humberts are among former breeders on both sides of the border who have recently received the fraud squad’s letter. Jolene says police told her today it was sent to them by mistake.

Sgt. Robert Zensner, a spokesperson for the fraud squad, says the letters sent to about 700 former contract breeders in Canada and the United States were intended to give those who had not yet filed one last opportunity to do so.

The fraud squad and the Royal Canadian Mounted Police have been looking into the case since June 2008 and in January each police force assigned two officers full-time. The review was bumped up to a criminal investigation in June. No charges have been laid.

Letters, signed by the case’s lead investigator, Det. Gino Salese, sent out to some Canadian and U.S. breeders who had already filed a complaint, were “just an oversight,” Zensner says. He explains the overlap likely happened because some former breeders held more than one contract and contact information may have appeared differently on some of these.

Asked if the overlap meant that records of these complaints – about 150 – had been lost, he responds, “oh no, absolutely not.” Those who have already filed complaints don’t need to respond, he adds. He notes the squad has fielded some calls about the letter from breeders who have already filed complaints.

Humbert says the Canadian authorities are the only ones she knows of investigating PKI: “We still don’t have anybody in the States looking at this (former breeders’ complaints).”

She says she would like to see a “clearing house” in the United States for people who feel they have been victims of “any type of scam” that originates outside of their local police jurisdictions.

“That’s what’s been so frustrating about this (PKI) is because every place we go, we’re just ignored, we’re put at the bottom of the pile,” she says. “We keep getting bumped from person to person and we’re not getting anywhere at all.”

Establishing a national centre for the investigation of financial crimes in Canada is the aim of a new group based in Quebec.

The Be Strong Movement is also seeking tougher penalties for crimes such as investment fraud and compensation of $1,000-$1,200 a month for a year for hardest-hit victims.

Through its website the group offers victims an opportunity to connect with others who have had similar experiences.

Janet Watson, of Sherbrooke, Que., is one of the group’s organizers. She’s also one of 1,600 victims who lost money when AMF (Autorité des marchés financiers), Quebec’s securities regulator, shut investment company Mount Real in 2005. She says most of Be Strong’s members are former clients of Montreal-based financial planner Earl Jones who was arrested in July and faces four counts of fraud and theft.

On Monday, the group rallied outside a Montreal courthouse to raise awareness about financial crime and to launch a petition calling for the reform of laws concerning white-collar crime. Inside, Jones’ trial, scheduled to begin, was postponed for three weeks.

Scott Hunsberger, of Kitchener, says he attended the rally to raise awareness about Pigeon King International and represent farmers who had lost money in the scheme. Hunsberger, who lost money in an electrical conservation marketing scheme, formed Business Opportunity Busters to raise awareness about fraud. He had no money invested in PKI but has previously challenged the company’s business practices.

Hunsberger says the Be Strong group “didn’t seem to be too interested" in his group.

Watson says that’s because her organization is “grassroots” and wants to work directly with victims rather than groups. BF