Victims want justice but police reluctant to investigate financial fraudsters

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Lower Mainland resident Clifford Earl Erickson was handed a criminal conviction in 1998 for defrauding business associates of hundreds of thousands of dollars and another in 2001 for duping a woman who he had promised to marry out of $92,000.

At the time, in articles in The Province (included below this article), his brother said he was a con man who would bilk his own mother. In each case, he was given jail sentences of two years.

Fast forward two decades later and Erickson, now in his late 70s, has again been accused of fraud.

At least five civil suits were launched since 2012 in B.C. Supreme Court against Erickson, alleging he defrauded complainants of more than $2.6 million. The court record also includes claims against Erickson for writing bad cheques and failing to pay a lawyer more than $15,000.

The recent allegations have not been proven in court.

The alleged victims want Erickson investigated by the authorities, too.

But when one complainant tried to get the police to investigate, they refused. Another complainant says he was discouraged by police from even filing a complaint.

Others, too, have been frustrated when trying to get the police to investigate serious investment frauds, including a major $30-million Ponzi scheme.

Investment advocates and victims believe the lack of criminal prosecution creates an environment where investment frauds believe they can operate with impunity.

These examples where police have declined to investigate underscore the findings of a Postmedia investigation, first published in November, that showed criminal prosecutions for investment fraud are rare in B.C.  

Experts say police are often reluctant to investigate complex investment frauds because their resources are directed at more straightforward cases, such as drug possession.

While police sometimes refer investment-type fraud complaints to the B.C. Securities Commission, less than two per cent of the $510 million in penalties levied by that regulatory body has been collected in the past decade, according to Postmedia’s investigation.

“Spending some time in jail, that’s where the real deterrent comes in,” said Marian Passmore, director of policy for the Canadian Foundation for Advancement of Investor Rights.

Cristie Ford, a UBC law professor, said penalizing or prosecuting financial crime is difficult. It can be the hardest crime to prove, Ford said, because you have to follow the money, often in many different directions.

Ford, the director of UBC’s Centre for Business Law, said pursuing investment crimes takes expertise that police forces may not have and may go against a police culture oriented toward solving violent crime.

Ford said there is little co-ordination across investigative, regulatory and enforcement agencies — including police departments and securities commissions — when it comes to investment crime.

“The bottleneck is really around expertise and desire to pursue these very tricky cases,” said Ford, who has made presentations to the B.C. Securities Commission.

Ford suggested a solution could be creating a financial fraud unit, with members from various B.C. police forces, housed at the securities commission, with the necessary expertise and resources.

When Robert Lemon considers Erickson’s criminal convictions of nearly two decades ago, he wonders why he couldn’t get the police interested in new allegations of fraud.

Lemon filed a 2014 claim in B.C. Supreme Court against Erickson and a woman named Ritsuko Tsurigida after Lemon’s longtime partner Robert Ledingham died the year before. The claim alleges $1.1 million advanced to Erickson and Tsurigida, which was secured by a promissory note, was not repaid to Ledingham.

Lemon claims Ledingham made payments into an investment, the Panama-based Spanish Endowment Fund, whose directors included Erickson and Tsurigida, and there is no record of repayments or dividends.

Erickson responded to the claim, stating he never received the funds.

But particularly galling to Lemon, and the reason he went to police, was Erickson contacted him after his partner’s death, trying to get him to invest $300,000 in the Spanish Endowment Fund, he said.

Lemon said Erickson pitched investments in internet phone service cards in Cuba and global shipments of oil, and also said he was close to acquiring the rights to McDonald’s restaurants in Cuba. When pressed for evidence of the investments, Erickson did not provide any, said Lemon.

“This to me was the slap in the face. This guy needs to be punished. The audacity to phone again, it’s insulting for a grieving partner,” said Lemon

Read the full story over at the Vancouver Sun.

This story was summarized by Canadian Fraud News Inc.