Ontario investors say they’ve lost millions following the abrupt closure of a Kitchener company. CBC News has uncovered that the man behind it is not only a savvy salesman but has a lengthy criminal record.
David Villanueva dressed for success.
At the office or out on the town, his extra-large frame was always draped in a new suit and a designer shirt. Outfits accessorized with thick gold chains, diamond rings and luxury watches from the likes of Rolex and Patek Philippe. And size-13 dress shoes he often bragged were custom-made and cost $30,000 a pair.
Imposing and impressive, with charisma to burn, the 62-year-old had a knack for putting people at ease — and separating them from their money. He found willing investors seemingly everywhere he went: a car dealership, a jewellery store, a golf club, his wife’s workplace. And he seemed relentless in his hunt for more, encouraging clients to refer friends, family and colleagues, even hitting up total strangers at wedding receptions.
The pitch could be persuasive. “I’ve said this before and I’ll say it again. ANYONE who entrusts my company with 50 to 100K and just lets me invest it as I see fit, will get back 150 to 300K in 12 months. ANYONE,” Villanueva wrote to prospective investors in a WhatsApp group chat in the summer of 2022. “It works! I turned 200K into 600K for myself in 11 months last year. It works!”
However, that’s not how things turned out for dozens of people in Ontario’s Kitchener-Waterloo region. They say they’re collectively missing millions of dollars after Villanueva’s firm The Factoring Collective — which claimed to buy up struggling companies’ accounts receivables at a discount, then collect on them in full –– abruptly shut down in early 2023. Many people are now convinced they fell victim to an alleged Ponzi scheme and have complained to police, belatedly discovering they’re not Villanueva’s first unhappy investors.
If you search his name on the internet, almost nothing comes up, and all of his social media posts have recently been deleted. But CBC News has uncovered Villanueva’s lengthy criminal past — six separate fraud convictions, with jail sentences totalling 17 years.
In the mid-1990s, an Ontario judge likened him to a “vulture” and “shark” who preyed on unwary victims. During a prison stint in the 2010s, a psychologist determined Villanueva “exhibited the core personality traits of a psychopath.”
Over the past three decades, he’s claimed to be a boxer, lawyer, marriage counsellor and the scion of a wealthy Caribbean oil family. He has gone by a variety of names, including David Carter, Dr. David Anderson and David Whitehead.
In Toronto, he was found guilty of running a fake law firm. In North Bay, he pretended to be a psychologist. There was a sham bid to buy a minor league baseball team in London, Ont. And, almost 20 years ago, another debt-laden factoring business in Halifax.
Distressing news for his latest investors.
“He actually promised me hope. Hope that he could do this,” Rose Takacs says, sitting at the dining room table in her Cambridge, Ont. home.
The 70-year-old met Villanueva (who was going by the name David Auger-Villanueva) at the jewellery store where she works part-time. As a regular customer, he had struck up friendships with the clerks behind the counter, convincing them he could make them rich. He promised to double or even triple people’s money, sometimes overnight.
Takacs made an initial $1,000 investment in the spring of 2022, receiving a cheque for $1,600 within a couple of days. Needing money to pay for an expensive dental procedure and dreaming of renovating her house to make it more accessible for family members with medical issues, Takacs cobbled together $85,000 more, borrowing against her home equity and maxing out a credit card.
“It wasn’t for greed. Greed was not involved with this. This was for my family,” says Takacs. “[Villanueva] kept on saying how he wanted to help people realize [their] potential, how easy it is.”
Takacs says she received a $1,500 transfer from Villanueva in March, but hasn’t heard from him since. The rest of her investment — and purported gains — are long gone, she fears. She has filed a complaint with Waterloo Regional Police, but has little faith it will lead to anything.
“I lost. I lost big time,” she says.
Takacs isn’t alone. CBC News has interviewed dozens of people who say they have been victimized by Villanueva over the years. Several asked that their names be kept confidential, saying they were trying to hide their monetary losses from family, friends and business contacts.
One single mother said she lost $30,000 — money borrowed from her father that had been earmarked for her children’s education. A young man who signed over a $10,000 settlement from an accident that left him with permanent injuries remembered how he delivered the cheque using his walker. A former police officer who loaned Villanueva $6,000 provided text messages in which the ex-con deflected requests for repayment with references to COVID-19 restrictions, banking problems and cancer treatments. A businessman who took out a $290,000 mortgage in order to invest in The Factoring Collective expressed his fears of what will happen once his children discover his life savings are gone.
“Everything about him looks like he’s successful. He has the nice suits, he’s got the gold cards filled into his wallet, he’s got the nicest vehicles,” says Neil McCormick, a former employee of Villanueva’s in Halifax. “It’s only after the damage is done and after he’s gone that you find out that everything was just a sham.”
A Waterloo Regional Police spokesperson says the force has “no information to provide” about its investigation of Villanueva, and he has not been charged with regards to his Kitchener business dealings.
In a series of text messages with CBC News, Villanueva said he wanted to get his side “of what happened, out there,” even agreeing to meet for a sit-down interview in mid-September. But he didn’t show up at the appointed time and day. He later hired a Toronto criminal defence lawyer, who turned down subsequent interview requests. Both Villanueva and his lawyer declined to provide answers to detailed, written questions about his past and recent business dealings.
‘David told so many stories’
According to newspaper databases and parole records, Villanueva’s first federal fraud sentence was handed down in Sarnia, Ont., in 1995, where he had been operating as an unlicensed paralegal, representing injured workers and immigrants before government tribunals. Claims that should have been paid out to his clients ended up in his pocket instead. At sentencing, the presiding judge described Villanueva as a “liar” and “parasite,” and handed him five years in jail.
By 1999, Villanueva was again at liberty and working in sales for the London Werewolves, a fledgling minor-pro baseball team in the independent Frontier League. John Kuhn, then the general manager and now a Florida high school teacher, hired him.
Villanueva disclosed that he had been to jail, says Kuhn, explaining that “it was a misunderstanding with his ex-wife — something to do with his kids.” (The thrice-married Villanueva has four children.)
A believer in second chances, Kuhn didn’t much care. But he soon had cause to regret his decision.
“David told so many stories. After a while, I didn’t know what was true,” says Kuhn, recalling his former employee’s claims that he was suffering from a brain tumour.
Villanueva organized a promotional giveaway of a trip to Alaska, but it turned into a disaster when the winning fan discovered there was no free plane ticket. Kuhn began to doubt other deals his employee delivered.
“I started looking at the contracts, and all the signatures looked the same,” he says.
As the season drew to a close, Villanueva, who often spoke of his family wealth — claiming his father was Trinidad’s representative to OPEC — mounted a bid to buy the team, selling shares to season’s ticket-holders. Then he went to Nova Scotia to get married and never came back, absconding with $33,000 he had collected from the team’s fans.
It took a decade, but Villanueva was eventually convicted of fraud over the fake takeover bid and sentenced to 15 months in jail, plus 10 months already served in pre-trial custody.
In 2004, Villanueva was again convicted of fraud in connection with another paralegal firm that he and his new wife had set up in Amherst, N.S. He avoided jail time, and was sentenced instead to two years of house arrest, and three more years of parole.
The restrictions had little effect. Within a year, Villanueva was back on the prowl, befriending a retired Halifax plumber at a church social and convincing him to invest $365,000 in a non-existent factoring business. Subsequent investigations determined the money was used instead to establish a call centre company — and underwrite his flashy lifestyle.
Neil McCormick was in his mid-20s and just starting out as a consultant when Villanueva hired him to set up two Nova Scotia phone banks, making him the firm’s vice-president. It seemed too good to be true, and it was.
“David was such an artful liar,” McCormick says. “He’s 100 per cent convincing in whatever he tells you.”
As part of his compensation, Villanueva offered McCormick a zero-interest mortgage on a condo. Then, when the deal failed to materialize, he vowed to take over McCormick’s rent payments.
A few months later, in early summer 2006, Villanueva simply disappeared, leaving behind more than 40 employees owed weeks of wages, as well as a string of angry creditors.
Shortly after his boss left town, McCormick found out he was being evicted for non-payment of rent. Although that paled in comparison to the discovery that Villanueva had set up a new, numbered company, transferred over all the unpaid call centre debts and named McCormick as its director. Leaving him to face the wrath of those seeking repayment.
“It was crippling. There’s no other way to put it. The final number was well north of $3,000,000,” says McCormick. “Trying to prove to companies that you don’t owe this debt… It was devastating. It took a decade to recover from.”
The retired plumber and his wife launched a lawsuit against the Nova Scotia government, claiming inadequate oversight of Villanueva’s house arrest and parole conditions, settling for an undisclosed amount.
A history of deceit
After fleeing Halifax, Villanueva resurfaced in Toronto, with a new identity and a new scam.
Calling himself David Carter, and claiming to be a Miami-based lawyer, Villanueva set up a downtown law firm, advertising heavily in the local media. Carter-Herzog, as it was known, purported to be specialists in workers’ compensation and immigration matters, and took on dozens of clients, charging large retainers. Villanueva, who billed himself as “senior counsel,” hired two actual lawyers, and several support staff, to do the bulk of the work.
The scheme succeeded for the better part of a year, until clients and creditors started clamouring for the money they were owed and Ontario’s Law Society began to look into “David Carter’s” credentials. Just before Christmas 2007, Carter-Herzog threw a fancy holiday party for its employees, where the boss magnanimously announced that everyone was getting an extra week of paid vacation between Christmas and New Year’s. When they returned in early 2008, the offices were closed, and Villanueva was nowhere to be found.
Among the victims was a Toronto mother of three who had gone to Villanueva seeking help for her husband, a Mexican national facing immigration proceedings. He ended up being deported. “It was all one big lie,” she told the Toronto Sun in 2010. “This man took our money and never did a thing for us.”
Villanueva’s time on the run lasted a little more than three weeks. In late January 2008, police in North Bay, Ont., arrested him after finding a car “David Carter” had rented — and stolen away with — in a motel parking lot. Their investigation determined that Villanueva had set out his shingle in town as an accredited psychologist and marriage counsellor, calling himself “Dr. David Anderson.’’ He told clients he also had a law degree and a specialty in criminal psychology.
Over the following two years, Villanueva was charged, tried and convicted for the frauds in North Bay, London, Toronto and Halifax, receiving jail sentences totalling more than 10 years.
Sent to a federal institution, he kept busy writing a book. How Prison Really Works: An Idiot’s Guide to Surviving a Prison Sentence was self-published as an ebook in 2016. Billed as a “tongue-in-cheek look” at life behind bars, it also offers some insight into why Villanueva had defrauded so many people over the years.
“Contrary to what many people think, it had nothing to do with money or greed,” he wrote. “It was about gaining power … power which I would then use to insulate myself from all the ‘normal’ people I saw going about their business every day.”
The guide ranks 839,907th on the Kindle Store bestseller list.
According to documents obtained by CBC News, Villanueva was a model prisoner. Nonetheless, officials expressed doubts that he was ready for conditional release, citing his long criminal record and past violations — including having fled the country for Florida and Trinidad while on parole from his first Ontario conviction in the early ‘90s.
An August 2014 Parole Board hearing noted a prison psychologist’s conclusion that Villanueva posed “a high risk” for re-offending. “You lack empathy,” the panel wrote in its decision denying parole. “You have a personality that allows you to be interpersonally exploitive [sic] and that you have a tendency to take advantage of others to achieve your own ends.” Villanueva’s history of deceit made “it virtually impossible” to “safely manage” his behaviour, the report said.
Yet just three months later, Villanueva was granted day release.
In February 2016, Villanueva was arrested after his boss at a catering company complained the former inmate was trying to get him to invest in a restaurant venture — a violation of his “no business deals” release condition. A subsequent hearing raised concerns about Villanueva’s tendency to lie to his parole officer.
“You spoke of being a bestselling author…You suggested you are in negotiations with CBC for the Canadian version of ‘Orange Is the New Black’, which the Board does not find credible,” said the May 2016 decision officially revoking his parole.
Four months later, he was back on the streets.
Tracking Villanueva via GPS
Villanueva’s past victims wonder why the sentences weren’t stiffer and the actual time in jail longer.
“There is a severe breakdown in our system,” says Neil McCormick. “Because these are white-collar crimes, because it’s money that people are losing and not limbs, he’s allowed to operate with very minimal supervision.”
McCormick says “every time this man is allowed out, he just starts the cycle again and millions of dollars are missing.”
Meanwhile in Kitchener-Waterloo, investors in Villanueva’s factoring business are asking why the current police investigation is taking so long. The first fraud complaints were lodged last winter, they say, and from the outside, progress seems fitful.
The signs of trouble date back even further, with Villanueva’s former employees telling CBC News that paycheques became sporadic starting in December 2022 — even as the company threw two lavish Christmas parties for clients and staff.
In mid-January, Villanueva and his third wife, Melissa Auger, hosted another swanky celebration at a London, Ont., hotel, commemorating their 15th anniversary and the renewal of their marriage vows. After a multi-course meal, the couple took to the dance floor for a slow sway to John Legend’s hit All of Me. According to an invoice obtained by CBC News, the total cost for the evening was $34,000.
By late March 2023, sightings of Villanueva were becoming rare, as angry investors besieged his office in a Waterloo industrial park in mostly failed attempts to recover their money. At one point, a large group assembled and placed tape over the exterior security cameras, forcing their way inside to look for him.
Adnan Khan, co-owner of Xtreme Motors in Kitchener, was among those becoming concerned about Villanueva’s whereabouts. Villanueva had been a client for three years, renting a variety of cars on a long-term basis. It’s a much more expensive option than buying or leasing, but it doesn’t result in your name and address being entered in Ontario’s Personal Property Security Registration (PPSR) system — a publicly searchable database.
Villanueva had recently upgraded to a Mercedes GLS, a luxury SUV worth more than $150,000. But he had fallen behind on his $6,000-a-month payments, and wasn’t responding to messages. So on April 3, Khan tapped into the car’s GPS tracking system, and watched with mounting apprehension as it headed towards a U.S. border crossing in Sarnia, Ont.
“All of a sudden, we say, ‘What the heck, he’s going out of Canada!’” says Khan. “We called the cops and they cannot do anything, [it] has nothing to do with them. So we called the border services in Sarnia…. ‘This is the make, this is the [vehicle identification number], it’s our rental car. Do not allow him to leave Canada.’”
The tracking data shows Villanueva eventually turned around and headed back towards Kitchener. After he arrived and parked in a downtown lot, Khan’s employees showed up with an extra key and took back the car. The interior was stuffed with bags and suitcases.
Villanueva later phoned the dealership to say he would be coming by the next day to collect his personal items and pay off his balance owing, but never followed through. Khan still has the bags in his showroom. They’re filled with suits, shirts, cheque books and business documents. There are also boxes with dozens of luxury watches, and a pair of size 13 burgundy and baby blue John Fluevog shoes.
Khan says he called the officer looking into the fraud allegations, and told her about the items. Months have since gone by.
“Nobody came here. Nobody did. And I explained it to them: ‘We’ve got a lot of stuff. A lot of evidence,’” says Khan.
Over the past few months, the investors have shared reports of sightings of Villanueva in various cities across southern Ontario. But no one seems to know his current whereabouts.
Hoping to recoup his money, Khan took the watches to a local jeweller. The man gave them one look and declared them all to be fakes — each worth hundreds rather than tens of thousands of dollars.
Per a quick online search, the shoes — Guardian Angel Winnie Classic Derby style — retail for $339. Currently on sale for $269.99. A far cry from the $30,000 ones Villanueva liked to boast about.
This article is originally sourced from www.cbc.ca