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#18954
CHURCH FRAUD by a former financial services overseer / perils of VOLUNTEER OVERSIGHT - BURRON 2019/04/08 12:33  
Particularly in self-managed or kitchen table scenarios, how safe are condo or Building Scheme funds ? Who would dare betray their neighbours ? Or their church ?

At year 25 as Treasurer of an unincorporated church in Ottawa’s prestigious New Edinburgh precinct, a trusted Federal financial integrity cop, finally retired as a Federal employee in 2010 .

C.P.A. designatee Barton Thomas BURRON had been able to flash gov't ID. Longtime Treasurer could cite professional positions with Auditor General of Canada or Office of the Superintendent of Financial Institutions. One of the watchdogs of financial probity protecting the public . . . .

BUT what this retirement-bound longtime Treasurer did next with the church’s assets, has been characterized as fraud & unlawful conversion in civil court decisions.

( It got labelled professional misconduct by ICAO the Institute of Chartered Accountants of Ontario whose professional disciplinary process in 2016 stripped for 5 years the non-defending Mr. Burron's CPA designation for these activities. It also imposed a $ 61 K fine presumably beyond collection.

Mr. Burron had replied to the initiating complaint that his actions had been authorized investments repayable to the church. That he had been neither technically "an employee" nor in a professional relationship with the church. )

How did this unfold ? While post-employment resuming work for the Federal securities watch-dogggers, Mr. Burron next pried more than $ 600 K - most of the church’s reserve assets - out of arms-length bank certificates & accounts !

ICAO found no record of any church authorization to invest, much less speculatively. Mr. Burron had invested most of the unincorporated church's funds without church authority into his own private ventures.

Moved the church financial records to his own home. No counter-signatures on cheques. Eventually manipulated records.

Those schemes collapsed in 2013, the losses were discovered, and Mr Burron was replaced. Mr Burron claims he had initially focussed on a condo development project. Then switched . Claims he & the missing funds had been the victim of a con man.

As with the early Teflon coating around Ottawa’s gambling priest in denial ( later convicted & jailed for a year ), a 2016 ICAO Disciplinary Report cites testimony that some church members had strongly disagreed with even challenging the Treasurer’s integrity.

( . . . That some "keep it secreters" later left the membership also ).

Only part of the civil judgments are at canlii.org They cite that the defrauded church members have obtained a $ 600 K judgment against their ex-Treasurer, who the ICAO decision said had declared bankruptcy & moved out of the area.

Mr Burron would have had a Federal civil service pension arguably partially garnishable.

BUT . . . Still in litigation are the unincorporated Church’s collateral breach of trust claims / negligence claims against another arms-length professional reportedly its "investment advisor" during Mr. Burron's treasurer tenure. His reported investment in Mr Burron's ventures now looks uncomfortable professionally.

Church overseers themselves get personally cross-claimed by the defendant advisor

An unusual wrinkle :

1 - Such collateral advisor defendant, has cross-claimed against named member-stewarts & generic “J. Doe” local church officers.

Argues that they should be held burden-sharing third party defendants who allegedly fell short of overseeing their ex-Treasurer Burron.

Ontario’s Court of Appeal appears to agree that this defence should be theoretically open. ONCA just upheld the other defendant’s right to cross claim against named and possibly future generic "J Doe"s. . ie presumably pre-2013 governancers, stewarts, volunteer auditors etc . .

Presumably without Fidelity Insurance ( ? ) the civil loss returns to being pursued in Superior Court

The unfolding process might well look at N.F.P. not for profit volunteer governance standards not much more than volunteer merely honesty or “good faith” ( as arguably for Ontario condo Directors before May 4 & 5 2001 ) .

2 - AUDITORS ? : The ICAO review heard that NO arms-length professional auditorship had occurred during the final 5 years of Mr Burron's activities !

3 - Status to sue ? ONCA wording ( just issued below ) suggests some degree of gob-smacking shock or concern that a non-incorporated entity was even able to somehow claim vires to launch in its own unincorporated name, a civil lawsuit in ONSC’s Eastern Region ! !


St Luke Lutheran Church v. McGregor et al, 2019 ONCA 261 issued April 3/19 http://canlii.ca/t/hzhzp

St Luke Lutheran Church v. McGregor et al 2017 ONSC 4060 http://canlii.ca/t/h4l0p
ONCA

* Aug 8/16 eight page “Discipline Committee Reasons” by PCC The Professional Conduct Committee of the Institute of Chartered Accountants of Ontario under the Chartered Accountants Act 2010 https://ebusiness.cpaontario.ca/discipline/ReturnFile_Action.cfm?Required=burron
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#18955
Even professionals make mistakes . . . 2019/04/10 13:13  
. . . but slow-bleed internal fraud can go undetected for years in volunteer or too casual governance.

Where NFP professionals themselves get snookered, there may be powerful incentives to keep it quiet or to postpone letting stakeholders / homeowners / press / NFP competitors, know . . . .

Bogus Email Payables scam snookers experienced City Treasurer

AN EXTERNAL HOAX - Ottawa Citizen jumps on gob-smacking 2018 gaff that was able to be effectively “deep frozen” ( by secrecy ) past 2018 election for NINE MONTHS by leaving to City Auditor’s next FORMAL REPORT.

Ontario's 2018 Sunshine Salary List shows that Ottawa's Treasurer was paid - and no doubt well earned - her salary of $ 264,851.60. plus $ 7,793.79 taxable benefits ( https://www.ontario.ca/page/public-sector-salary-disclosure )

Audit report presented Apr 8/19 : NINE MONTHS AGO Ottawa’s Treasurer on July 6/18 had received & personally actioned a $ 130 K ( Cdn) bogus payable email request 4 hours later ! Claimed from her boss, its sole support was the bogus email directive itself ( “Don’t mention to anyone else yet “ ! ). ( Citizen article also claims the fraudster’s actual email address could have been revealed by hovering a cursor over the 'spoofed' email address. ) Wired the funds . . .

Not until receiving a further bogus requisition for another $ 200 K ( Cdn ) did the longtime Treasurer smarten up & personally contact her superior. !

Goes viral on media. Councillors gob-smacked at being 'out of the loop'. Sympathetic Treasurer makes confused / humiliating mea culpa to Council heading to retirement in 8 months.

$ 130,000 in taxpayer money likely gone for good to group including 52 year old Florida man indicted for external internet payables fraud called BEC or “ business email compromise”.

Where targetting big shots it ironically gets called “whaling” ! Fraud email address may closely resemble genuine confirmation authority. Overworked or sloppy or whatever target may simply send “replies” or whatever diligencing queries directly to fraudsters instead of independently re-composing to the genuine alleged originator . . . .

Online comments include lots of rage from taxpayers or those put through Spanish Inquisitions to get minor planning approvals or internal spending authority :

“To be fair, she is in charge of a 3.42 billion dollar annual budget, or about 9.4 million dollars a day on average.”

“ Just wire money to someone without any source documents to support the purchase !”

“ . . . Because mistakes like this in private industry get hidden, you never read about them in the news, and that's why you think industry is better run than governments. Sadly, because phishing scams on this scale get buried almost all the time, the scammers are much safer from investigation and prosecution than they should be.” - some public comments . . .

April 8/19 Citizen “City treasurer was victim of a 'whaling' scam, transferred $100 K U.S. to phoney supplier” https://ottawacitizen.com/news/local-news/city-treasurer-was-victim-to-a-whaling-scam-transferred- 100k-to-phoney-supplier

April 10/19 Citizen “Florida man named as suspect in City of Ottawa fraud case faces trial in U.S. email scam” https://ottawacitizen.com/news/local-news/florida-man-named-as-suspect-in-city-of-ottawa-fraud-case- faces-trial-in-u-s-email-scam
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#18956
“The fact that the security guard is asleep does not mean you can rob the bank” 2019/04/13 17:32  
Is business better at detecting or preventing frauds or scams internal or external ? ( see the CBC commenter above ) ?

Defrauded businesses largely are not under whatever PUBLIC TRANSPARENCY pressure faced by condos / Building schemes / charities / NFP non profits/ government etc .

If defrauded business bucks are irretrievable, details may never publicly emerge from proprietors or management except for later recovery litigation or criminal process or securities disclosuring if at all.

Which duped business victim really wants disclosure ( including by auditors ) to arms—length stakeholders / customers / competitors ? ( think back : the + $ 20 M BBB bogus borrowing by-laws LOAN FRAUDS in Toronto condoland. Where did the scandals end up ? . . .) Wouldn't CLOSE SCRUTINY over one's own business bucks be expected ? Is business sometimes run like a volunteer owners association ? Maybe . . .

Details may eventually escape amidst rearguard struggles for power between shareholder factions. Or if some dramatic event hits the press . . . .

$ 20 M internal business embezzlement perpetrated over 10 years :

An exception that arguably may prove the rule ? : Longtime embezzler CFO James LAKE’s shocking subway suicide after being confronted in March 1996, could not be kept quiet.

The $ 20 M Lake embezzled from a late "one man show"'s realty service empire, had financed a lavish millionaire's lifestyle. Was a lifestyle for which the Lake estate eventually sued the victim ! Lake had even financially reported his take internally ( ! ) & paid Federal taxes on it to CRA ! With the fraud about to end that lifestyle Lake must have made some choices about losing it. BUT 22 years later memories fade / surprisingly little on internet . . .

xcrpted Welcome Investments Ltd. v. Sceptre Investment Counsel Ltd et al ., 2000 CanLII 22776 (ON SC) issued July27/00 http://canlii.ca/t/1wcqh


" . . . [5] James Lake was a cunning and rapacious fraudster who had been introduced to ( JJB ) when he had been employed in the accounting firm which did the audit and financial statement for ( JJB Ltd.).

In 1984 he left the accounting firm and joined JJB Ltd. replacing their existing bookkeeper.

Lake ultimately qualified as a chartered accountant and, having so qualified, he convinced JJB that he no longer required the services of an auditor and that Lake could do the financial statements and look after all matters related to banking and payroll.

Apparently Lake forged JJB’s signature to Waiver of Audit Forms and from that day forward the cat was loose among the financial pigeons with neither check nor balance .

[6] The procedure whereby Lake defrauded JJB Ltd. of some $20,000,000 was so simple and straightforward as to defy imagination.

In his capacity as Chief Financial Officer or Comptroller , Lake was the person who gave the instructions for the payments to be made under the payroll of the company.

A payroll service known as ZZZ, a service offered by the XXX Bank of XXXX, drew and issued the cheques in accordance with Lake’s instructions.

Over the approximately ten years in which Lake actively defrauded JJB Ltd. he simply instructed ZZZ to issue cheques payable to Lake as salary in ever increasing amounts until those payments on occasion were in excess of ten times Lake’s legitimate salary.

[7] . . . It was not as if Lake made even the remotest attempt to conceal his conduct. Quite to the contrary. The financial statements of JJB carefully recorded the excess payments made to Lake. The bank statements clearly demonstrated the excessive withdrawals from the corporate account.

The corporate tax returns made it more than apparent that excessive salary was being paid to Lake. The records of ZZZ itself, if reviewed, would have accurately demonstrated each and every improper payment.

The simple truth of the matter was that JJB , in a circumstance of startling disregard for his financial affairs, never once over a ten year period took the time to look at his financial statements, his bank records, the ZZZ records or the corporate tax returns.

$ 20,000,000 vanished into the thin air from his business operation wholly unmissed and unnoticed until the raw accident of the circumstances of the case at bar arose. . .

. . . the degree of trust placed in Lake by JJB must have been absolute..." unquote
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#18958
FRAUD CONVICTION : ex-financial integrity officer/ volunteer CHURCH Treasurer 2019/05/05 17:23  
In a parallel process uncited in prior media coverages, the Ottawa Citizen reports April 26/19 that Mr Burron has just been convicted of criminal fraud.

But somehow acquitted of "possessing criminal proceeds & falsifying documents to advance a fraud”. The threshold of criminal guilt for such, must be high given the details of this extended period of betrayal of church trust . . .

Whatever happens now to this strayed volunteer / first offender, inadequate financial controls can be a timebomb for condo & Building Scheme owners & Directors.

Ex-Treasurer Burron will be sentenced by 2014 Ont Ct of Justice appointee Justice Matthew Webber who ironically had defended gambling priest Father Joe LeClair. Father LeClair had denied & denounced his accusers from a church pulpit - see another cafcor topic . . .

( ? whether another sentencing companion piece to April 21/17 Citizen “ One year house arrest for former small claims Ottawa judge who stole from Catholic church” http://ottawacitizen.com/news/local-news/house-arrest-for-former-small-claims-ottawa-judge-who- stole-from-catholic-church ? )


Mr. Burron :

April 24/19 Citizen “Church treasurer found guilty of four-year, $600,000 fraud” by Andrew Duffy https://ottawacitizen.com/news/local-news/church-treasurer-found-guilty-of-four-year-600000-fraud

also Aprl 26/19 Canadian Accountant “CPA Fraud Blotter: Robbing Peter to pay Paul's iPads ? : A roundup of recent fraud cases involving Canadian accountants” http://www.canadian-accountant.com/content/business/cpa-fraud-blotter-robbing-peter-to-pay-paul
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#18989
VICTIM IMPACT STATEMENTS / perils of VOLUNTEER OVERSIGHT - BURRON 2019/08/16 15:40  
Will or should it be a sentence mitigator that a victim organization left a volunteer Treasurer without any checks against fraud ?

"Here Mr Burglar. Let me hold your ladder & flashlight . . . ."

Aug 15/19 victim impact statements, print edition shows first published photo of now-convicted ex-Treasurer Barton Thomas Burron now 73 years of age https://postmediaottawacitizen2.files.wordpress.com/2019/08/73246298-13210702-w.jpg?quality=80&strip=all&w=266&h=199&crop=1

Videoclip : Minister laments that ( now-convicted ) ex-Treasurer has subsequently refused process of Christian forgiveness & reconciliation. Trusting community of faith rocked; tough to move ahead. . . .

- “It’s in the boxes.” : Ex-Treasurer Burron flippantly on day of confrontation 2014 after being asked "What has happened to the Church's funds ?"

( Church Council Chair on the videoclip deplores "hundreds of hours" needed to reconstruct the deceit-ridden trove of financial records surrendered by Burron. )

- Current Treasurer cites shocking discovery ( among them ) of "11th hour" cheques by which the victim church funds were initially even used to pay Burron's upfront defence retainers !

- Sentencing to occur Oct 4/19. Crown seeks 2 years penitentiary & $ 1 K monthly restitution order.

Citizen Aug 16/19 “Church members describe chaos, distress, strife caused by former treasurer's fraud” by Andrew Duffy https://ottawacitizen.com/news/local-news/church-members-describe-chaos-distress-strife-caused-by- former-treasurers-fraud
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#19005
2 year prison sentence for EX- INTEGRITY WATCHDOG; "one man show" looted church for condo scheme 2019/10/05 00:05  
73 year old Barton Burron has been sentenced to TWO YEARS IMPRISONMENT for looting his church's funds.

As a "one man show" without oversight the long time former Treasurer poured the Church's $ 607 K into his failed condo development scheme ! Only a portion has been offset.

Oct 4/19 CBC “Former church treasurer sentenced in 'sad' fraud case; Bart Burron gets 2 years in prison for embezzling $607K " by Krystalle Ramlakhan https://www.cbc.ca/news/canada/ottawa/former-church-st-luke-lutheran-treasurer-sentenced-two-years- prison-embezzling-fraud-1.5309043

Oct 4/19 Citizen “Convicted church treasurer handed two-year prison term” by Andrew Duffy https://ottawacitizen.com/news/local-news/convicted-church-treasurer-handed-two-year-prison-term
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#19007
wide variety of sentencing 2019/11/12 18:13  
Who would cheat the weak & vulnerable ?

CRA Revenue Canada threatened to impose sanctions on Directors of a Toronto NGO non governmental organization channelling $ 150 month support payments to disabled individuals.

That's after an external audit showed that the agency's $ 85 K per year Finance Director on sick leave immediately on appointment had set up a three year $ 900 K phony payroll fraud.

Press reports include that before discovery the Director - now professionally disbarred as CPA - had even stick-handled the termination of a subordinate to avoid detection.

And had raged about others' greed . . .

In contrast OTTAWA church volunteer BURRON had at least served his victims for 25 years before embezzling. A 73 year old integrity cop / volunteer's 2 year sentence arguably might be harder on him than what hit the $ 85 K salaried employee above :

In contrast : In a press-reported TORONTO sentence not yet at canlii.org : 6 AND A HALF YEAR IMPRISONMENT is imposed ( with potentially 3 additional years for breach of restitution orders and $800K in fines ). But will any be collectible at all ?

Against the Toronto NGO Directors personally, will CRA discontinue the payroll breaches ? - unknown . . .

Oct 24/19 ToSun “Toronto charity thief jailed, ordered to repay $ 1 M” https://torontosun.com/news/crime/charity-thief-jailed-6-5-years-ordered-to-repay-almost-1-m

Sep 16/19 from ToSun “Fraudster's theft inflicted deep suffering for disabled” https://www.thewhig.com/news/crime/fraudsters-theft-inflicted-deep-suffering-for-disabled/wcm/ ef3172e9-3589-406e-9588-7167db45d12d
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