A convicted Burnaby fraudster accused of bringing another company to the brink of ruin by defrauding it of hundreds of thousands of dollars has been found guilty of stealing just $147.
Arthur Tat Yue Wong was hired in 2010 to manage the books at Phoenix Media Direct Inc., a successful supplier of large-format printers and paper, according to provincial court documents.
In December 2011, one of the co-founders, Steve Carter, said he got a call from American Express demanding a $64,000 payment on an overdue account.
That sparked an internal audit that revealed about $570,000 in illegitimate expense claims.
A subsequent RCMP investigation whittled that sum down to about $200,000.
Last week, however, B.C. Provincial Court Judge Nancy Phillips ruled the prosecution had not proven beyond a reasonable doubt Wong had stolen more than $147 – an unauthorized payment made on the company credit card to Dance Power Enterprises, a dance competition company.
Wong had been accused of making unauthorized purchases on the company’s credit card, transferring money from the business’s bank account to Mastercard accounts held by his family and claiming unauthorized mileage expenses.
Carter said Phoenix had operated successfully for nearly two decades before Wong’s arrival; by the time he left, the business was on the brink of collapse, forcing owners to sell it at a “fire-sale price” in July 2012.
Reasonable doubt
Wong’s lawyers, however, argued the lack of underlying documentation raised reasonable doubts as to whether the expenses Wong claimed were illegitimate or had been approved at the time.
Phillips agreed, saying she had found “significant problems relating to the impugned expenses and claims throughout the evidence,” as well as “reliability problems in the evidence in terms of trying to determine how credit cards and corporate funds were used when scrutinized years after the fact.”
One issue highlighted during the trial was the shortcomings of the RCMP investigation, conducted by an officer in his first year of financial crime work.
“In Mr. Wong’s case, he did not obtain receipts, invoices, or other underlying documentation in an attempt to reconcile the expense claims involved,” Phillips said. “He also did not establish the business policies and procedures used by (Phoenix) to determine whether Mr. Wong followed them or not. He relied on an incomplete vendors list and an informal audit by a person who was not at arm’s length from (Phoenix) and whose professional skills may have been out of date or inadequate. For reasons which were not always clear, accounting staff from both the Canadian and US operations were not apparently interviewed or called to testify.”
Phillips also noted concerns with Carter’s credibility.
“All of these things leave the Court with a doubt as to what Mr. Wong’s role was in relation to the allegations before the Court,” Phillips said.
She found Wong guilty of one count of fraud in relation to the $147 dance contest payment.
Others
He will be back in Vancouver provincial court on April 12 for sentencing.
It won’t be his first sentence.
Three years ago, he was sentenced to two-and-a-half-years in jail for defrauding a North Vancouver couple’s business, Unique Accommodations, of nearly $400,000.
He is also currently on trial for fraud in Surrey in a case involving Gold River Seafood Ltd.
- Corneila Naylor, Burnaby Now