THE Crown has laid criminal fraud charges against a man who allegedly operated a fraudulent investment scam out of West Vancouver.
Provincial Crown prosecutors have charged 23-year-old Adam Keller with nine counts of fraud, according to Sgt. Duncan Pound, federal policing media relations spokesman.
Keller has also been sanctioned by the B.C. Securities Commission for fraudulently taking $523,100 from investors, according to spokesperson Richard Gilhooley.
A three-member B.C. Securities Commission panel unanimously served Keller with a lifetime market ban in B.C., an order to pay back the $523,100 he stole and a fine of $1.6 million dollars.
"He's got just about as serious a penalty as we offer," said Gilhooley.
Keller claimed he would execute foreign exchange deals through his company Great White Capital Corporation. He lied to investors about his background and how investments were performing, prepared false account statements and used the funds for personal use, said Gilhooley.
Under B.C. Securities Commission sanctions, Keller cannot promote, buy or sell securities, start a company, own property or sit as an officer or director for a corporation.
He has also been entered into a national ceasetrade database that encourages other jurisdictions to reciprocate these orders.
One of his victims, a West Vancouver resident, lost hundreds of thousands of dollars.
According to Gilhooley, there is no evidence that investors will recover their assets.
Keller's operation was a straight investment fraud, according to Gilhooley, in which the scammer solicits money from investors (generally for something that brings in absurdly high returns) but there is no underlying asset. The money from new investors is used to pay existing investors with massive, even ridiculous returns.
"The fuel is the new investors," said Gilhooley.
To outsiders, Keller's operation checked out, complete with a website, promotional packages and a home office in West Vancouver for Great White. Keller prepared false account statements that induced investors to invest more, said Gilhooley.
In these situations, it is common for fraudsters to take their investors' money and spend it very quickly "on some kind of lifestyle they think they deserve" in order to maintain a successful appearance, said Gilhooley. "The burn rate with some of these frauds is unbelievable," he said.
Keller rented an opulent brick mansion at 888 Sentinel Drive in West Vancouver for $16,000 dollars per month. He wore designer clothing and drove a conspicuously expensive car.
Keller is no longer in Canada and his last property rental was in Colorado, according to RCMP spokesman Pound.