A 20-month RCMP investigation has led to the arrest of a 45-year-old Red Deer man accused of bilking victims of $10 million.
Police said a suspect was arrested and charged with money laundering and fraud after a search warrant was conducted at his home on C&E Trail north of Red Deer on Dec. 19. Documents and electronics were seized by police.
The alleged scheme involved the purchase, sale and rental of mobile light tower by Silvertip Energy Inc. After getting reports of the alleged crimes, RCMP began a complex investigation in April 2016.
RCMP allege that the owner of Silvertip Energy sold or rented light towers with the same serial number to multiple investors and sold or rented units that were never manufactured.
Five individual investors lost about $4 million and at least four companies in Canada and the U.S. lost $6.2 million, say police.
“This is an example of a Ponzi scheme, where the same light towers were bought and rented numerous times on paper, on behalf of a number of different investors,” says Const. William Lewadniuk of Red Deer RCMP’s financial crimes unit.
“Each level of a Ponzi scheme includes re-selling the same items to new investors, then paying a portion of that money to previous investors as if it were dividends.
“Ponzi schemes are like pyramid schemes in that they rely on continually bringing in new investors in order to keep the previous ones from discovering the fraud.”
Red Deer RCMP financial crimes unit worked closely with the U.S. Secret Service and the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) throughout the investigation.
“I believe this may be the largest fraud file we’ve seen in Central Alberta,” says Lewadniuk. “The Red Deer RCMP’s cross-border collaboration with the U.S. Secret Service and our ongoing partnership with FINTRAC were vital to its successful conclusion.”
The RCMP investigation continues.
FINTRAC is Canada’s financial intelligence unit. Its mandate involves the detection, prevention and deterrence of money laundering and the financing of terrorist activities, while ensuring the protection of personal information under its control.
The U.S. Secret Service is mandated by Congress to carry out a unique dual mission: safeguarding the financial and critical infrastructure of the United States, and protecting the nation’s leaders.
Joshua James Tenhove has been charged with three counts of fraud over $5,000 and one count each of laundering the proceeds of crime and possession of property over $5,000 obtained by crime. He is due in Red Deer provincial court on Jan. 15.