Kenneth Lawrence

Kenneth Lawrence was sentenced Friday to two years in prison for defrauding Royal Bank of Canada of $2.8 million. (CBC)

A P.E.I. businessman who defrauded Royal Bank of Canada of $2.8 million was sentenced to two years in prison on Friday, the first time a mandatory minimum sentence for white-collar crime has been handed down on the Island.

Kenneth Lawrence, 54, of Johnstons River used to operate Discount Car & Truck Rentals, with three locations on P.E.I.: Charlottetown, Summerside and Montague. Over five years he borrowed money from the bank, telling them it was to buy vehicles for his fleet, the court was told.

Instead, he fabricated vehicle identification numbers for 157 vehicles and submitted those to RBC. The vehicles didn’t exist, the court heard.

The fraud was discovered two years ago when the bank ordered a financial audit. Lawrence declared bankruptcy shortly after.

Lawrence read a statement to the court Friday. He apologized for committing the fraud and said he was finished living a double life.

Lawrence’s defence lawyer, Joel Pink, said his client committed the fraud to try and keep his businesses afloat.

"Basically he did it to try to save his companies and to keep the people employed who were all family people in P.E.I., so they would have a paycheque at the end of the month," Pink said.

Judge John Douglas said he sometimes regrets putting offenders in custody, but in this case he said he had no option due to the new federal mandatory minimum sentences.

The prosecution and defence called the two year sentence fair. Lawrence had pleaded guilty and had no prior criminal record.