Regulator working on fraud case

Alberta’s securities regulator is preparing its case against a man and a woman accused of defrauding investors in an alleged Ponzi-like scheme.

Arnold Breitkreutz of Calgary and his companies are accused of raising millions in mortgage investments and spending the cash not on mortgages but to pay other investors in a manner consistent with a Ponzi scheme.

The Alberta Securities Commission alleges B re it kr eutz, h is company Base Finance, and its office administrator, Susan Elizabeth Way, told investors their money would be loaned to borrowers as mortgages on Alberta real estate.

According to the securities commission, Base Finance raised $83.5 million from investors between Jan. 1, 2011 and Sept. 1, 2015.

Of those funds, the company paid other investors $79.8 million in interest and principal payments, the regulator alleges.

As of September 2015, Base Finance owed 240 investors about $122 million but had no funds to pay them. None of the claims have been proven.

The securities commission will meet Oct. 19 to set a date for a hearing into the alleged fraud.