Appeal Court reduced Waterloo fraudster’s sentence

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Toronto (August 27, 2020) – The Ontario Court of Appeal reduced the sentence of the convicted fraudster, Daniel Reeve, to ‘time served’. In 2018, the former chief of DPR Financial Inc. was convicted of fraud over $5,000 to 14 years in prison – the maximum sentence for fraud. Using a Ponzi scheme, he defrauded at least 41 people out of about $10 million. On May 29, 2020, Reeve’s appeal was granted and his sentence is now considered complete. The Waterloo fraudster was released on the same day.

The Court of Appeal for Ontario granted the appeal of Daniel Reeve, former Waterloo Region financial adviser and convicted fraudster. The court reduced his 2018 maximum sentence to ‘time served’. He is now a free man.

Fraud ‘for purposes of greed and ego’

Reeve ran the financial investment company ‘DPR Financial Inc.’ in and around Kitchener. Reportedly, he had a good reputation in the financial industry. Besides his business as a financial planner, he wrote several books about investments and made media appearances regarding his approach to investing.

From January 1, 2007, to September 30, 2009, he perpetrated a large-scale fraud ‘for purposes of greed and ego’ on 41 unsuspecting clients. Court documents say he solicited investors to make various investments that he characterized as ‘low-risk’, ‘no-risk’, or ‘guaranteed’ and promised returns between 12 to 20 percent. Unbeknownst to investors, Reeve used the investor funds to pay out shareholder loans to himself and his ex-wife, to pay expenses of his failing companies; and to repay other investors in the manner of a Ponzi scheme.

That way, he defrauded at least 41 of his clients of about $10 million. In 2012, Reeve was charged for investment fraud.

‘Mr. Reeve was fully aware of the devastating impact that the loss of all or most of their life savings would have on the victims. The fraud was substantial – $10-12 million. Mr. Reeve was unlicensed. He took full advantage of the high regard he had in the community and the personal trust and faith the victims had in him,’ wrote trial judge Antonio Skarica.

The maximum sentence of 14 years’ incarceration

In June 2018, Reeve was convicted of fraud over $5,000. Justice Skarica sentenced him to 14 years in prison – the maximum sentence for fraud cases in Canada. Furthermore, he ordered payment of almost $11 million within 10 years to pay back his victims. If he fails to compensate his victims, he faces another 10 years in prison.

Given that he had already spent 71 months in pre-sentence custody at Maplehurst Correctional Complex in Milton, counsel agreed that he should receive credit in the amount of 8.9 years. He was provided with an additional 1.1 year of credit due to what the trial judge deemed ‘harsh conditions’. Hence, his pretrial custody was counted as 10 years and he was released on day parole after serving eight months in prison.

Three months later, Reeve was arrested in May 2019 after the Correctional Service of Canada temporarily suspended his parole because a person – he tried to trick into an investment – reached out to the police. The Board explained its decision to revoke the parole with his immediate return to his offense cycle which poses an ‘undue risk to society’.

Moreover, in November 2018, after Reeve was sentenced, the Ontario Securities Commission (OSC) permanently banned him from participating in Ontario’s capital markets. He can never again own or trade securities or serve as a director or officer of a company.

Reeve appealed his 14-year sentence.

Reeve’s lack of remorse during the trial as an aggravating factor

Reeve pursued both a conviction and a sentence appeal. During the appeal process, Reeve’s defense argued Justice Skarica made an error in handing him a 14-year sentence, saying it set a precedent outside the law and that his lack of remorse cannot be used against him.

The Appeal Court found that Justice Skarica focused in his sentencing on the impact of the frauds on Reeve’s victims: ‘The sentencing judge described the victims as ‘disabled, the elderly, the grieving spouse, the emotionally vulnerable, the close long-time friends, the loyal client, and complete strangers’. Many of them lost their life savings to the appellant.’ Moreover, the trial judge concluded that there were no mitigating circumstances and used the lack of remorse as an aggravating factor in his sentencing.

‘While a genuine expression of remorse can serve to mitigate a sentence, the opposite is not true,’ reads the sentencing of the Appeal Court. ‘An offender cannot be punished for a lack of remorse. The reason is clear. Punishing an accused for failing to express remorse comes ‘perilously close’ to punishing him or her for exercising the right to make full answer and defence.’ The appeal judges made clear that it is the fundamental right of every accused to be able to assert the right to full answer and defense, free by fear of future implications.

Hence, the appeal judges found that the Waterloo fraudster was punished for his failure to show remorse, including by exercising his right to a trial. ‘It is an error in principle to use the absence of remorse as an aggravating factor for which the accused should be punished,’ the appeal judges determined. ‘Accordingly, I conclude that the error in principle is inextricably linked to the imposition of the maximum custodial term imposed in this case.’

Appeal Court reduced Reeve’s sentence

On May 29, 2020, the Appeal Court judges granted Reeve’s appeal and reduced his sentence to ten years’ incarceration. In all other respects, the sentence was affirmed. Subsequently, the sentence of the 60-year-old is now considered complete.

Correctional Services Canada informed Reeve’s victims in a letter that his 14-year sentence has bee reduced following his appeal.

In the afternoon of the same day, Reeve was released from Beaver Creek Institution. He is now a free man if he will be able to comply with his restitution order and fine in lieu of forfeiture order. If he fails to make good on that, he has to serve another ten years in prison.

Read more: Verdict still months away in protracted Daniel P. Reeve trial