The former boss of Canadian Brenda Martin, who has been in a Mexican prison for the past two years, alleges Mexican officials are using his former cook as collateral for his unpaid debt.

Alyn Waage of Edmonton told the Canadian Press Monday that his lawyers struck a deal with Mexican officials the day after his arrest in 2001, agreeing to pay $500,000 US for his freedom.

"They decided half a million dollars and we'll call it a day, thank you very much," he said.

Waage, 61, masterminded an Internet-based fraud scheme called Tri-West Investment Club that bilked 15,000 investors around the world out of nearly $60 million US. He fled to Costa Rica when a Mexican appeals court released him on bail.

U.S. authorities later apprehended him and eventually extradited him to a low-security federal prison in Butner, N.C., where he's serving a 10-year sentence.

Waage claims Mexican officials are now holding Martin, 51, from Trenton, Ont., and Rebecca Roth, an American, both former employees arrested for their alleged roles in the scam, as ransom for his unpaid debt.

"[They] feel that they're owed half a million dollars that I was supposed to pay them before I got out of jail, which I didn't pay," he said.

"Until they get that half a million dollars, I don't think they're going to let them go. They're holding them for ransom."

Waage said he can't recall the names of the officials who allegedly asked for a bribe.

Both Martin and Roth have written to him saying they'll be released once he pays the money, he said.

"They've been told if I pay [the officials] the money, they can go."

Martin worked as Waage's cook in Puerto Vallarta for 10 months until he fired her in early 2001.

Martin told CP last week she was fired after calling Waage's mother "a very nasty name."

"I just couldn't overlook it," Waage said of the incident with his mother.

But he says he agreed to pay her a year's worth of severance — roughly $24,000 US — because he felt bad about firing her.

"You have to understand that, at that time, money didn't matter a hell of a lot. It was $2,000, $24,000, $200,000 — I didn't give a shit," Waage said.

"I was rolling in it. I had more money than I could spend."

Martin invested money in Waage's scam

Martin invested $10,000 US in Waage's Tri-West Investment Club. She has said she thought it was a good investment and didn't know it was a fraud.

Waage has backed her claim in a sworn affidavit. He says no one — not even his wife — knew of the scheme.

"How could [Martin] possibly [know about the scam]? None of my employees did. What, am I going to hire some cook off the street and tell her I'm controlling a multimillion-dollar scam? What, am I crazy? No, of course not," he said.

"If anybody in the house knew it was a big scam going on, they'd have run like rabbits."

Mexican authorities arrested Martin in February 2006 on allegations of money laundering and participating in a criminal conspiracy connected to Waage's scam.

She's been held for more than two years at the Puente Grande women's prison near Guadalajara during her trial.

The Mexican government said in a recent statement that Martin's "close relationship" with Waage "for a fair length of time … leads to the supposition that she had some knowledge of the criminal activities in which her friend was engaged."

Canadian officials, Martin's lawyer silent

A man who answered the telephone at the Mexican Embassy in Ottawa said no one was available because of the Easter Monday holiday.

Calls to the Canadian Embassy in Mexico City were referred to the Foreign Affairs Department, which declined to comment.

Martin's Toronto-based lawyer, Guillermo Cruz Rico, said he's not aware of the alleged bribe attempt. He also declined to comment on Waage's allegation.

Mexico's justice system has long been criticized for human rights abuses. Amnesty International released a report last year citing specific cases of torture and police intimidation, along with arrests without cause and unfair trials.

Foreign Affairs' travel advisory website urges Canadians to exercise a high degree of caution when visiting Mexico.

"There have also been cases of legitimate police officers extorting money from tourists or arresting tourists for minor offences," it says.

Prime Minister Stephen Harper said last week that while he's "troubled" by Martin's plight, Mexico has its own justice system and Canada can't interfere with it.

"We have to remember, we are talking about another sovereign country and we are talking about a judicial process, and judicial process is, by definition, independent," he said.