Calgary seniors lose $350,000 in alleged Ponzi fraud
Last Updated: Tuesday, September 15, 2009 | 6:47 PM MT
A Calgary couple who lost a "good portion" of their life savings in an alleged Ponzi-type scheme don't expect to see their money again.
Helmut and Genie Vollmer said they lost at least $350,000 invested in what they thought was a gold mining company that promised a rate of return of between 35 and 40 per cent.
The couple invested in Syndicated Gold Depository S.A., which RCMP allege is part of a Ponzi-type scheme, a pyramid scam in which the original investors are paid off by new investors. Albertans Milowe Allen Brost and Gary Allen Sorensen, who allegedly ran the scheme, face fraud charges.
'I am not expecting a penny back, because I am sure there won't be a penny.'—Helmut Vollmer
The two men are accused of bilking 3,000 people in Canada, the U.S. and overseas out of $100 million between 1999 and 2008.
The Vollmers, a couple in their 70s who owned a motel before their retirement, began investing seven years ago on the advice of an accountant.
"How he convinced me I still don't know to this day," recalled Helmut Vollmer.
Doubts grew when statements stopped
The couple saw their investments grow on paper, but started having their doubts about a year and a half ago when the statements stopped arriving in their mailbox and they couldn't contact the company to make small withdrawals on their investment.
Genie Vollmer recalled a standing-room-only meeting in a hotel where Brost tried to ease investors' concerns. She said she had no idea so many people were involved, because they were told not to talk about their investment.Milowe Brost, who has been charged with fraud, lives in this home in Chestermere. (CBC)
"He is a very smart man. I have never met anybody like him, a very good talker," she said. "It's hard to even follow him. But he is so good at explaining things and it all sounded so good and truthful."
Despite joining a class action lawsuit, the Vollmers don't expect to get any money back.
"I am looking more for satisfaction. I am not expecting a penny back, because I am sure there won't be a penny. I want those people to come to justice for all the people worked all their life for their savings and looked forward to retirement. And some of them are much worse off than I am," Helmut Vollmer said.
Brost, a 55-year-old who lives in Chestermere, is charged with fraud over $5,000 and theft over $5,000. Police are still looking for Gary Allen Sorensen, 66, a Calgary man believed to be in Honduras. He faces the same charges.
Police said the two men created Syndicated Gold Depository S.A., then formed an agreement to lend money to Merendon Mining Corporation Ltd. with a promise of a high rate of return. Investors were then enticed into offshore shell companies marketed by Brost's firms Capital Alternatives Inc. and Institute for Financial Learning Group of Companies Inc., said the RCMP.
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