A Calgary man who bilked his clients out of millions of dollars in a massive Ponzi scheme has been handed a 10-year prison sentence and was ordered to pay $3.1 million in restitution.
Arnold Breitkreutz, 74, was found guilty of fraud over $5,000 by Court of Queen’s Bench Justice Colin Feasby, following a trial that took place in June.
In sentencing Breitkreutz, Feasby described the “deliberate, large scale” fraud that “profoundly” affected the lives of the victims, some of them retirees.
The judge noted common themes of anxiety, depression and a “profound sense of betrayal” suffered by the defrauded investors, many of whom lost everything to a man they’d come to trust.
Although Breitkreutz’s company Base Financial began operating in the late 1980s and took investors’ money for more than 30 years, the time period considered by the courts was over 16 months, from May 2014 to September 2015.
Investment losses in Base Finance totalled more than $100 million, but much of that falls outside the offence dates.
Still, there were more than 100 investors who lost around $21 million in that offence period, the judge noted.
‘Risky oil play in Texas’
Investors in Base Finance believed their money was secured by mortgages on real estate in Alberta when in fact it was loaned to an oil and gas promoter and used in “a risky oil play in Texas and secured against oil and gas leases and equipment,” wrote Feasby in his conviction decision.
Earlier this week, prosecutor Shelley Smith asked the judge to consider a sentence of between 10 and 12 years, while defence lawyer Cale Ellis-Toddington proposed a five- to eight-year prison term.
In 2019, the Alberta Securities Commission (ASC) ordered Breitkreutz and his office manager, Susan Elizabeth Way, to repay nearly $4 million.
At the time, the commission called the scheme “among the worst frauds perpetrated in Alberta.”
Breitkreutz and Base Finance Ltd. were permanently banned from trading or purchasing securities after being convicted of contravening the Securities Act.
Last year, Way was sentenced to three years in prison after pleading guilty for her role in the fraud.
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