Criminal groups threatening capital markets, RCMP

December 8, 2008

fattonyDean Beeby, The Canadian Press and The Globe and Mail have an interesting article today, Criminal groups threatening capital markets, RCMP.

OTTAWA — Organized crime has become a significant threat to Canada’s capital markets, a new report from the RCMP’s fraud squads says.

Major crime groups are recruiting investment professionals to help them move far beyond traditional activities – smuggling, extortion and counterfeiting – into the rarefied world of high finance and market manipulation, the Mounties say.

“Using the markets requires a degree of knowledge and expertise,” says the draft report from the RCMP‘s Integrated Market Enforcement Teams, or IMETs.

“Organized crime groups harness this skill set by using professional facilitators in the industry.

“The facilitators’ subjective knowledge of the true nature of these schemes ranges from willful blindness to direct fraudulent participation.”

This has hypothetical interest only since franchising is essentially a capital exchange mechanism. Further:

Organized crime and “criminalized professionals” – rogue investment specialists – are described as the two main players in financial crimes.

Criminalized professionals? They mean the crooked investment dealers, right? Right?

The Canadian Bar Association is ferocious in protecting any tiny little-weeny, tensy attempt to limit its members’ airtight solicitor-client privilege.

This of course (again in only the most-twisted imaginations possible) creates and maintains a safe haven for the buying and selling of legal services that enable international organized crime.

  • Fat Tony and his counsel have nothing to fear from any hoser.

It’s taken Canada years to develop its reputation as the world’s best place for white-collar crime:

  1. no national regulator (take our OSC…please),
  2. no securities investigations (Lord Black, Nortel, Livent…),
  3. amnesiac centralized commercial bankers.
  4. oh the list goes on and on.

A farce, really.  In summary, just go ask Al Rosen why he doesn’t invest in CDN listed stocks.

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Collusion allegation: AUS bank and franchisor

September 18, 2008

In a Smart Company article by James Thomson called MP renews calls for investigations into mistreatment of Bakers Delight franchisee, he quotes:

NSW parliamentarian Joanna Gash has renewed calls for the Australian Federal Police to launch an investigation into accusations Bakers Delight and ANZ bank colluded to put a franchisee out of business.

Quoting emails between the franchisor and the bank, Gash alleges:

On Monday, Gash revisited the case in Parliament, producing emails from Bakers Delight chief financial officer Richard Taylor and ANZ executives that she says shows “plans had been conspired to terminate Ms de Leeuw’s franchise well ahead of time”.

The bank and franchisor deny all the allegations.

This is the first public AUS public allegation of the key franchisor:franchise banker relationship that I identified and wrote about in a 2005 paper for Industry Canada called Franchising Opportunism [free download].

The Royal Canadian Mounted Police did a 10 month investigation of a related predatory franchise lending matter. [free download: Mounties investigate ‘predatory lending’, Ottawa Citizen, March 25, 2006]

And Mr. Oudovikine is accusing the bank of transferring the loans to Country Style without his authorization before he had a chance to obtain a business plan and other financial details from Country Style.

Mr. Oudovikine says his case shows how big banks, franchisors and franchise brokers team up to take advantage of franchisees, many of whom are recent immigrants like him.

“It’s predatory lending. (CIBC) didn’t do any of the due diligence they should have done,” says Mr. Oudovikine, who sent the Citizen e-mails confirming the RCMP investigation. An RCMP official said the police force doesn’t confirm or deny investigation.

And the Canadian bank’s reaction?

Mr. Oudovikine says he has repeatedly contacted senior CIBC officials and executives about the loan dispute, to little effect. He alleges that CIBC breached the Canada Small Business Financing Act regulations that require lenders to conduct due diligence on borrowers, including their ability to repay loans.


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