Elderly retirees and hard-working immigrants who penny-pinched and saved for a better future say they are in precarious financial straits since being defrauded their life savings through a Ponzi scheme orchestrated by Base Finance Ltd. and two conspirators Arnold Breitkreutz and Susan Way.
While the company, Breitkreutz and Way were sanctioned by the Alberta Securities Commission with financial penalties in the millions and bans preventing them from ever trading in or purchasing securities, it pales in comparison to the financial duress their victims are now enduring.
In the ASC’s decision, several victims submitted statements including a man and his wife, both in their 80’s, are unable to afford payments needed to enter a retirement home.
“The panel commented in the sanctions decision that: the amounts taken from the investors by Breitkreutz and Way; the extended period of time over which they were taken; the number of investors affected by the misconduct, and the fact that the respondents continued not to take responsibility for their conduct makes this one of the worst frauds perpetrated in Alberta’s history,” said Cynthia Campbell, director of enforcement with Alberta Securities Commission.
Some investors were led to believe that their money would be invested into mortgages for real estate and then later found out when they tried to foreclose that the money had instead been invested in “oil and gas”. Arnold Breitkreutz repeatedly denied misleading investors and asked to be reinstated to which his request was denied and he was given a lifetime ban against trading in securities and derivatives.
The number of victims total more than 240 and are owed $122 million after the scheme collapsed in September 2015. The vast majority of the investors who were affected were Albertans. The panel examining the case also issued fines to Breitkreutz and Way.