Ex-bank manager jailed for fraud

Two years for stealing, hiding $277,000 in family accounts — over seven years

KITCHENER — A depressed Bank of Montreal branch manager in Kitchener used accounts in her dead mother’s name and others in her two sisters’ names to defraud the bank for $277,000, court heard on Tuesday.

Catherine Roberts, 58, of Cambridge, spent the cash on gambling and shopping. She pleaded guilty to fraud over $5,000 and was sentenced to two years in prison and ordered to make full restitution.

After her mother died, Roberts was depressed and in a “downward spiral,” Justice David Broad said in a summary of the case.

“She acknowledged that she spent the money that she took from her employer on shopping and gambling and did so in order to make herself feel better.”

Roberts launched the fraud in January 2004, the month her mother died, while managing the Highland Hills branch on Highland Road West in Kitchener. The fraud continued when she was transferred to the Laurentian Hills branch on Ottawa Street South in Kitchener in 2008.

She was fired when her crimes came to light in July 2011.

“Ms. Roberts’ actions represented an egregious breach of trust, magnified by the fact that she had been employed by BMO for 22 years, attaining the position of branch manager,” Broad said.

“The fraud was perpetrated over a seven-year period, and therefore did not represent an isolated lapse in judgment.”

Roberts fraudulently opened BMO accounts, including lines of credit, in the names of her two sisters and mother. The accounts in her mother’s name were opened before she died, but Roberts continued to use them after her death. Her sisters did not know she opened accounts in their names.

The total amount defrauded was $277,787.

The bank described Roberts’ crimes as a “sophisticated lapping fraud,” meaning she moved money from account to account to conceal the fraud.

BMO said Roberts took advantage of her knowledge and position as a manager for her own personal gain.

The bank said its loss goes beyond what Roberts took because a criminal prosecution of an employee for crimes at the bank hurts its reputation in the community.

Broad noted Roberts defrauded a chartered bank, “which gave it a quasi-public aspect.”

“Members of the public, in entrusting their financial wellbeing and security to chartered banks, have a right to expect the highest level of trustworthiness on the part of banks and their personnel,” the judge said in his remarks.

“Bank employees who act dishonestly not only put their employers at risk, but also put the confidence of the public in our financial institutions at risk.”

Roberts ended the fraud only when her crimes were discovered.

“There is nothing to suggest that she would not have continued in her fraudulent activity if she had not been caught,” Broad said.

Roberts’ lack of a prior record is a mitigating factor, the judge said, but the fact that she was previously considered trustworthy is “blunted by the fact” that most large-scale fraudsters are in a position to commit the crime because of their sterling reputation.

The judge said Roberts already suffered shame and humiliation for her actions.

“She has experienced loss of, or damage to, her relationships with family, friends and work associates and has had her employment prospects significantly diminished.”

When her crimes came to light, Roberts immediately acknowledged her wrongdoing.

In court, she expressed remorse, “stating that in the almost six years since her actions were discovered, not a day goes by that she does not regret what she did,” the judge said.

Roberts has made no restitution, although she has agreed to pay back $300 a month.

The judge said the bank is unlikely to recover much of its $277,787 loss. Before going to prison, Roberts worked as an independent travel and cruise consultant, contracted to Expedia, making $15,000 a year.

Crown prosecutor Patricia Moore sought a prison term of two to four years; defence lawyer Bruce Ritter asked for two years less a day of house arrest.

“The applicable legal principles direct that I impose a period of incarceration, which would adequately reflect the predominant principles of deterrence and denunciation,” the judge said.