Prison time for fraud

A P.E.I. man who defrauded clients of almost $1 million was sentenced Monday to two years in prison.

David H. Cudmore appeared before Judge John Douglas in provincial court in Charlottetown for sentencing after pleading guilty to seven counts of fraud.

Cudmore was a financial planner and worked with Frank Harrison Dew at Morton Dew in Charlottetown.

Dew was sentenced in June to 54 months in prison on 26 counts of fraud totalling more than $2.9 million.

On Monday, the court heard Cudmore met with numerous clients and got cheques from them in frauds related to insurance premiums and investments. The amounts those clients were defrauded varied from $20,000-$375,000.

In total, Cudmore defrauded clients of $978,000.

In July 2015, a lawyer for P.E.I.’s Consumer, Corporate and Financial Services division contacted Charlottetown police about complaints from Morton Dew clients. Several agencies were involved in investigating the fraud, including insurer London Life.

Cudmore did not repay any of the money, but the court heard London Life compensated the victims for what they lost.

Crown attorney Jeff MacDonald said the victims were described as “unsophisticated” investors who put their trust in Cudmore and Dew, turning over their life savings to them. There were a large number of transactions over a long period of time and Dew took significant efforts to conceal what he had done, MacDonald said. Cudmore declined to address the court before hearing his sentence.

The two years was a joint recommendation from the Crown and defence.

As he handed down the sentence, Douglas said two years might appear to be on the light side, but a lot of factors go into a joint recommendation that may not be before the court. Unless the joint recommendation was out of line he couldn’t deviate from it, Douglas said.

Douglas ordered Cudmore to pay $978,000 in restitution and $1,400 in victim surcharges.