Reeve guilty in $10M fraud
Former financial adviser could spend 14 years in jail
KITCHENER — A man who previously rode around in a stretch limo, wore the best suits and wrote seven financial advice books was reduced to a common criminal on Friday after being found guilty of ripping off 41 investors of $10 million.
Daniel P. Reeve, a former financial adviser in Cambridge and Waterloo, had been sitting in the courtroom with his defence lawyers as they awaited judgment. That changed when the judge announced guilty verdicts on fraud over $5,000 and theft over $5,000.
“Mr. Reeve, you will now go in the prisoner’s dock where you belong,” Justice Toni Skarica told him.
Reeve, 57, entered the box and was handcuffed. The man who had previously appeared composed and confident now looked bewildered. Dozens of his victims, some of whom lost their life savings, were watching. He was remanded in custody pending sentencing next June.
The trial, which began in mid-2015, was one of the longest in Waterloo Region history.
“This trial established an overwhelming case of fraud and theft perpetrated by a devious, clever, calculating, cold-hearted man who has absolutely no remorse for the many lives that he ruined,” Skarica said.
Reeve owned an array of local companies, including DPR Financial Inc., Jakobstettel Properties Inc., Reeve Hotels & Resorts Inc. and Millionaire Mortgage Inc.
He lived in a grand farmhouse near Elora. He wrote
financial books with titles such as: “The Secret of the Three Buckets,” “The Mirrored Butterfly” and “The Wealth Effect.”
Reeve promised investors above-average returns on what he called low-risk investments. He did not deliver.
“What was the motive for Daniel’s crimes?” Skarica asked. “Perhaps only Daniel knows. However, Daniel was used to, as his brother put it, a ‘large’ lifestyle. He had a driver and a stretch limo, plus a fleet of automobiles: a $100,000 BMW 740, two Escalades, a Land Rover and a Porsche.”
At one point, Reeve ordered extensive work on his home, including a six-car garage, exercise rooms and a $75,000 bathroom renovation, the judge noted.
Reeve got into the financial business in the 1990s and brought solid returns to his clients for years, several investors said. Everything changed with the stock market turmoil starting in late 2007.
Money from investors was used to pay off previous investors or diverted to prop up his failing companies and pay for his lavish lifestyle and a seven-figure divorce settlement.
The judge likened Reeve’s actions to a Ponzi scheme.
“Woody Allen once described a stockbroker as someone who invests your money until it is all gone,” Skarica said. “This is a good description of what Daniel Reeve did to the 41 victims.
“To put it simply, Daniel knew everything that was going on: the investments, the diversions, the lies, deceptions and non-disclosures to the 41 victims, in addition to the losses the victims were incurring and were going to incur,” Skarica added
“The evidence is overwhelming that Daniel knew that his conduct had put their money at risk. In the end, the 41 victims suffered the inevitable Armageddon and lost approximately $10 million.”
Reeve spent several weeks on the witness stand. He claimed he did nothing illegal.
“Daniel testified that he did not tell the 41 victims that their investments were not going to be spent as promised, but were instead to be diverted,” the judge said. “Daniel testified that he did not tell them that because he did not know in advance.
“In the context of all the other evidence at trial, that evidence is not believable. It is a blatant lie.”
Glen Brubacher, a Belwood farmer who lost $750,000 to Reeve, said in an interview Friday that Reeve’s demeanour throughout the trial seemed to say, “What did I do wrong?”
He was pleased the judge concluded he was guilty as charged.
Brubacher, 53, was asked how Reeve appeared when he was taking his money.
“Very professional,” he said. “Convincing, but arrogant. That’s the part I didn’t like about him.”
“Smooth as a snake,” said his brother, Murrel, 44, an Elmira man who lost $150,000 to Reeve.
Murrel said the loss had a huge impact on him.
“We had a young family. It was the start of bad things between my wife and I. It took a toll on our marriage. We’re separated right now.”
The rip-off was “the beginning of stress and turmoil,” he said. “Then it just went downward from there. And I’m as much to blame for it as anybody because I was the one that wrote the cheque.”
He said Reeve promised 15 per cent interest on his investment. He got nothing. “Not a nickel, not a nickel.” Andrew Wigboldus, 68, of Woodstock, said he began investing with Reeve in the 1990s.
“He did me a lot of good. I had an excellent rapport with him and made a lot of money. Everything was above board.”
That changed. “He took my money and ran.”
Wigboldus said he was lucky Reeve only got $20,000 from him. Still, it was “more than I can afford.”
Several victims didn’t want to give their names to the media out of shame of being taken to the cleaners.
“You feel like you’re dumb, like you’re really dumb,” said a retired man from Fergus who lost $300,000.
He was pleased to hear the judge slam Reeve.
“Well, that was good,” he said. “But where’s our money? We can’t afford to do anything. He took our savings.”
Reeve’s ex-wife, Cheryl Reeve, a prosecution witness, testified she received a $2-million divorce settlement from Reeve. Most of the money came from investors.
Skarica on Friday said the $2 million might be considered proceeds of crime.
“Is there any hope of obtaining that money?” he asked.
“Not in the Crown’s view,” prosecutor Fraser McCracken replied.
Cheryl Reeve died last year at 53.
A weeklong sentencing hearing for Daniel P. Reeve starts next June 11, the earliest block of time lawyers and the judge could agree upon.
Reeve will be sentenced only on the fraud charge after the theft charge was conditionally stayed because both charges deal with the same facts.
The maximum sentence for fraud over $5,000 is 14 years in prison. Reeve has been in jail since his arrest in July 2012.
McCracken said in an interview he can’t say how many years he will seek.
“We’re going to be studying the judgment and reaching our conclusion based on that.”
The trial was one of the longest in Waterloo Region history, running intermittently starting on June 8, 2015.
It took many lengthy breaks due to scheduling issues.
More than 70 witnesses testified and more than 330 exhibits were filed. Skarica’s written judgment runs for almost 1,000 pages.
The judgment refers to several victims, including Josephine DeSalvo, an Italian immigrant who took 35 years to save up $200,000 only to have it taken by Reeve. On the witness stand, she called Reeve a pig, a liar and a “miserable soul.”
“Are you aware that you are defending a person who has stolen tons of money?” the Brantford woman asked defence lawyer Mary Cremer back in June 2015. “You shouldn’t be here defending a thief — a big, huge thief.”