Pair convicted in New Minas 'car-swapping' fraud face sentencing hearing

The notation letters for car trader Darren Bateman are highly supportive, describing him arsenic highly generous, helping radical with wealth and vehicles, paying for them to spot shows oregon rapidly stepping up to bargain fundraising auction tickets.

While connected its aboveground that fiscal benevolence might seem good thing, a Halifax authoritative pointed this week to a large problem. It came contempt the 60-year-old owing much than $1 cardinal successful taxation fines portion also embroiled successful a large-scale fraud involving a New Minas, N.S., car dealership.

"Generosity is besides a prime that tin beryllium addictive," authoritative Shauna MacDonald told a Halifax provincial courtroom. Bateman could consciousness bully astir his deeds, she said, adjacent though helium didn't person the means to wage for them.

Bateman, on with co-accused Orlando Smith, 65, faced a sentencing proceeding Thursday for their roles successful a analyzable "car-swapping" scheme, astir 8 years aft they were charged and pursuing a proceedings wherever they were convicted of fraud and possession of proceeds of crime.

Both pleaded not guilty. They are seeking conditional sentences to debar incarceration, portion the prosecution wants Bateman handed 3 years down bars and 2 years for Smith. Judge Elizabeth Buckle volition contented her determination successful September.

'Staggering magnitude of money'

All told, the fraud was repetitive, complex, motivated by greed and amounted to astir $1 million, according to MacDonald, "a staggering magnitude of money, by immoderate definition."

The dealership that was defrauded was Summit Hyundai, wherever Bateman worked nether declaration and wherever Smith was wide manager and a shareholder.

Summit had a ballooning inventory of utilized cars due to the fact that it was overpaying for trade-ins successful an effort to person customers to bargain caller vehicles. The occupation was that presumption of the dealership's slope financing meant the utilized cars had to beryllium sold wrong a definite period.

As a workaround, Summit began successful 2015 selling utilized vehicles to a institution operated by Bateman, which successful crook sold antithetic vehicles backmost to Summit, allowing the dealership to reset the timepiece connected its loans.

In her 2023 proceedings decision, Buckle called the strategy "unethical and possibly fraudulent," and said the proprietor of Summit, Ken Barrett, apt came up with it to support the slope astatine bay, though helium was not charged successful the case.

A crucial issue astatine trial, however, was the worth of the vehicles. While the swapping woody was supposed to beryllium gross neutral, Buckle recovered it was "lopsided" by astatine slightest $440,000 successful favour of Bateman's company and to the detriment of Summit.

Buckle besides recovered that Summit paid Bateman's institution for vehicles that weren't delivered to the dealership. In different cases, Bateman rented vehicles and past created mendacious documents to marque it look similar his institution really owned them and was selling them to Summit.

Support from family, friends

During sentencing, defence lawyer Stan MacDonald, who represents Bateman, said fixed the justice recovered Barrett complicit successful oregon alert of some aspects of the car-swapping and rental schemes, "the value of the fraud" committed by Bateman "is reduced."

It's not a lawsuit akin to that of an concern councillor who steals clients' money, helium said, and the fiscal problems suffered by Summit cannot beryllium solely pinned connected his client, but were besides the responsibility of Barrett, who yet sold Summit Hyundai successful 2017 for a loss.

The defence lawyer urged the justice to condemnation Bateman to 2 years of location apprehension followed by 3 years of probation.

Bateman does person a record. In 2000, helium was convicted successful a car-selling strategy aimed astatine dodging income tax. He was fined $1.1 million, but Buckle was told he's lone paid disconnected $16,000. His lawyer said helium had been paying $100 a month, and determination had seemingly been nary attempts to cod the rest.

Jeremiah Raining Bird, the lawyer for Smith, noted 25 notation letters supporting his client. He took contented with the characterization of Smith arsenic "toxic" to Summit, and said helium was a beardown new-car salesman who made the concern money.

And portion the prosecution is seeking steep fines from the pair, Raining Bird said his client should lone beryllium connected the hook for $58,000, the magnitude of wealth a fiscal investigation determined had flowed from Bateman's company to Smith and his wife.

Big regret? Not testifying

Smith addressed the tribunal astatine Thursday's hearing, telling Buckle helium respected her determination to convict him "based connected the grounds presented" astatine trial, but said his biggest regret is not testifying successful his ain defence.

He said helium was erstwhile the astir sought-after wide income manager successful Canada, and he made Summit millions of dollars by selling caller cars. He said the used-car facet was lone a tiny information of the business.

He questioned wherefore Barrett was ne'er charged, said helium "shouldn't person listened to him" and regretted getting progressive successful thing helium didn't recognize was fraud.

"I'm not a atrocious guy, I'm not a criminal," Smith told Buckle. "I don't cognize however the hellhole this happened. I mislaid everything. I can't work. I'm not a menace to society."

In court, Bateman apologized to his household and friends "for everything I enactment them done for the past 8 years," thanked them for their enactment and said "it's been a agelong conflict for them arsenic good arsenic myself."