Blue-blood investor faces string of fraud charges
THE EMPIRE OF JOHN SIMMONDS COLLAPSED IN JULY AFTER HIS ARREST
Mr. Goudas was once a popular and affordable household brand of beans, rice, noodles and ethnic foods such as canned slices of guava found on store and kitchen shelves across Ontario and Quebec.
But the brand abruptly disappeared in 2014. Rumours abounded that an alleged fraudster had drained Mr. Goudas of its lifeblood and put it out of business.
After a search, a reporter found Mr. Goudas products at a corner store, and a company headquarters north of Toronto. At the plant, three men say they bought the company out of receivership in 2014, to revive the brand. They blame the bankruptcy on one man: John Graham Simmonds.
Many in the horse- racing and investment communities in Ontario know Simmonds, 66. Brash and confident, he is an investor and executive, a scion of a blue-blood Toronto family, a father of six and grandfather of 10, and known to drive a Maserati or an Aston Martin.
Simmonds’s empire collapsed last July after the Ontario Provincial Police arrested him in Aurora, Ont., and charged him with a fraud involving a garbage truck manufacturer. The OPP released him to await trial. In September, York Regional Police arrested Simmonds, and charged him and eight others with a total of 42 charges, accusing them of a $ 30- million fraud related to the Mr. Goudas bankruptcy. On Feb. 2, police arrested Simmonds a third time and l aid four more charges.
These days Simmonds lives under house arrest, either on the farm his parents owned in Ux bridge, northeast of Toronto or at his daughter’s home in Cobourg. Until last week, a black GPS device on his ankle ensured he stayed put; now the court has ordered he may only leave the house with his daughter.
“It’s the first break I’ve had in along time ,” Simmonds said recently, looking out at snow-covered fields. “I’m enjoying it.”
The story of Simmonds, his investors, Mr. Goudas and the garbage truck company is a potboiler, mixing vast sums of cash, racehorses, imported sports cars, penny stocks and companies registered in Nevada. It also boasts a marquee cast including a retired general, a former ambassador, a disbarred lawyer and a jilted lover. If police get their way, it will end with Simmonds in a prison cell.
Those who know Simmonds call him “silver tongued ,”“patrician ,” “colourful,” and “next to a genius.”
Simmonds told the Post that, “I have bought and sold literally hundreds of companies. Never had a problem in my 50 years until now. I’ve done a lot of takeovers. Big takeovers, little takeovers, friendly, hostile; that’s what I do.”
He said he has owned 1,000 racehorses, but now owns just one.
The OPP charges relate to Fanotech Manufacturing Group, a maker of garbage trucks in Bracebridge and Huntsville, Ont., founded 50 years ago by Gabrielle Tomassoni. According to court documents and interviews, Simmonds met Lisa Tomassoni, Gabriel l e’s daughter, in 2009. Simmonds asked Lisa to marry him, went to Christmas dinner at the Tomassoni home, and began to help the family business.
“Simmonds represented that he had money in banks around the world and influential contacts at almost all of the Canadian financial institutions,” alleges a 2016 lawsuit that Fanotech filed against Simmonds, his longtime corporate secretary Carrie Weiler and Toronto- Dominion Bank, one of Fanotech’s banks. “Simmonds offered to help Lisa. Shortly after, Simmonds and Lisa became involved in a relationship.”
The business deal and the romance fell apart in 2011 as Fanotech foundered. Fanotech alleges in the lawsuit that Simmonds and Weiler forged signatures on account cards to open bank accounts at a TD Bank, and siphoned $ 1.7 million from Fanotech. “The fraud crippled Fanotech,” the claim alleges.
TD, in its defence, said, “the plaintiffs ratified any and all actions that Simmonds and/or Weiler took.” TD has also sued Simmonds and Weiler. Weiler in her defence said she has worked with Simmonds for 37 years, and that the Tomassonis approved her actions involv- ing Fanotech and TD Bank. She adds that she invested $ 50,000 in a related company, Fanocorp.
Simmonds told the Post that his troubles with the Tomassonis, including their lawsuit and the police charges, link to Lisa’s anger that they broke up. He has yet to file a defence with the court.
Asked if he t ook any money, he said: “No. They didn’ t have any money. Gabe … screwed up. I’m not the least bit concerned about Fanotech, because it’s all well-documented.”
In the Fanotech case, the OPP anti- rackets branch in July charged Simmonds with fraud of more than $ 5,000, theft over $ 5,000, money laundering and possession of the proceeds of crime.
In a related action, Miller Bernstein Greenwood LLP has sued Fanotech, saying Fanotech failed to pay its accounting bill in 2009-2010. Fanotech, in a defence, called the accounting faulty.
Not everyone who i nvested with Simmonds is as aggrieved as the Tomassonis. Ian Macdonald, managing director at Tricapital Management Ltd., who in the 1990s served as director of one of Simmonds’ public companies, calls him a fastdealing financier.
“He’s a rogue as opposed to a crook,” Macdonald said. “He would bang all this stock up and everyone else would have escrow. The stock goes down to Palookaville and you are left holding the paper. I lost tens of thousands of dollars, but I still respect the guy. It’s hard to get mad at him, because he’s such a charming guy.”
In response, Simmonds said: “In the 1990s I was involved in some very successful ventures. ( Macdonald) wasn’t involved in all of them. I can’t speak to his bitterness now. Sometimes you just gotta walk away and take your losses.”
Simmonds surrounded himself with trustworthy figures, which attracted investors.
Simmonds in June 2013 held a meeting for his Vertili ty Group of Companies, according to an agenda, at Toronto’s Granite Club, a sports club and dining room for the city’s moneyed elite. ( The club declined comment.) Ken Taylor, former Canadian ambassador to Iran, attended the meeting as chairman of Vertility’s advisory board. Another advisory board member was retired major- general Lewis Mackenzie.
Tayl o r di e d in 2 015. Mackenzie said he met Simmonds through a one- time close friend, Peter Shoniker. By the time Shoniker introduced Mackenzie to Simmonds, Shoniker had already pleaded guilty to money laundering, gone to jail and lost his licence to practise law.
Mackenzie said he also invested with Simmonds.
“Everybody lost money,” the former general said. “I guess I hold out hope that at some point in the future we will get the money back. I can’t regret things that seemed OK at the time.”
Donald Fenton, a public relations consultant, gave the Post a photo of himself sharing a basket of chips with Taylor at the Granite Club. Fenton said he and his wife invested $ 40,000 in a Simmonds company, Pacific Software, Inc.
“I’m thinking, ‘ This is a great guy and a credible businessman,’ ” said Fenton, who joined Simmonds as a communications adviser. “I wrote press releases and called the media. I got him some very good publicity in the Globe and Mail, Report on Business Magazine and BNN and PBS.”
The glowing press i ncluded a half-hour interview with Montreal j ournalist Robert Scully, whose show airs on 200 TV stations across the United States.
Those stories drew in more investors, including Frank Belvedere, who said Simmonds recruited him away from Griffiths Laboratories Ltd. to work with his companies in the food sector including Mr. Goudas.
“It was a fairly believable thing,” Belvedere said. “I recruited four people on the food side to work there. He said he had a family trust account worth $ 800 million. He had a nice office in King City. He had accountants and l awyers. Everything looked legitimate.”
Belvedere invested $ 16,000 with Simmonds. “John was sitting there selling 10- cent shares and fivecent shares, and we were all greedy I guess.”
York police in September arrested Simmonds, who faces 11 counts of fraud, forgery, possession of the proceeds of crime and issuing a false prospectus.
Last fall, police charged five other people who had attended the 2013 Granite Club meeting: Fenton, Jason Williams, Michael Grieco, Weiler and Ian Bradley. Police also charged Deborah Simmonds, ( Simmonds’ exwife and mother of his two youngest sons), Tyrone Ganpaul and John Mpardakis.
A police news release said all charges are “in connection with a criminal organization responsible for defrauding businesses, banks and private investors of more than $30 million.”
Those charges have not been proven in court.
Police allege that once Simmonds bought Mr. Goudas from its founder, Peter Goudas, he “funnelled large sums of money out of the existing business to himself, the co- accused and his shell companies to the point of bankrupting the food company.”
“I spent 45 years myself to lead this business. No sleep, no holiday,” Goudas said in an interview. “So he ( Simmonds) has to spend 45 years in jail. That’s the only way to replace what he took.”
Ken Bardai, a detective in York police’s fraud squad, said he plans more arrests. “Beware of schemes that are too good to be true,” he said.
Royal Bank of Canada, Mr. Goudas’ banker, alleges in a lawsuit against Goudas Food Products, a subsidiary of Simmonds’ A. C. Simmonds and Sons, that Simmonds loaded up the company’s books with “uncollectible receivables. As a result, RBC advanced monies against fictitious receivables, which will cause it to lose more than $8 million.”
Simmonds said a publication ban forbids him from talking about the Goudas case. He said he is innocent.
“I’m going to fight until the bitter end. I am going to defend myself and all the people that have been associated with me that are also unfairly accused,” he said. “None of these people have ever been accused of anything in their lives that I know of. I have never stolen a dime in my life.”
Fenton, Simmonds’s former spokesman, said he is innocent, since he did not direct the content of Simmonds’s news releases. He believes his investments are gone.
“I rue the day I met John Simmonds. If I am guilty of anything, it is of being naive. But so was the media.”
Simmonds, who now drives an Audi A7, said his investors should not write off their money. “I will be vindicated,” he said. “The people that are in this Goudas mess will make money.”
On Feb. 2, Simmonds and Weiler turned themselves in at a York police station. Police charged each with four new offences. Among the charges, police allege Simmonds breached a bail condition that he “not engage in any financial transaction involving stocks, bonds or securities.”
A check of Edgar, the U.S. securities disclosure system, shows that the board of Pacific Software Inc. appointed John Simmonds a director on Jan. 18, 2017.
The court released Weiler on bail the same day; Simmonds spent a night in jail and the court released him Feb. 3. Simmonds’s daughter Kathryn Simmonds posted $25,000 bail.
During the Post’s twohour meeting with Simmonds, he recalled with horror the four days and two nights that he spent in police custody last fall.
“They hand out strips of toilet paper. It’s barbaric. I thought I was in a jail in Chad or something.”
He said during those two days, ambulances twice rushed him to hospital for heart problems.
There may be one happy footnote. Mr. Goudas, a brand trusted by generations, may survive.
When Simmonds bought Mr. Goudas, Ramesh Jegarajah and Sarweswaran Vairamuthu, longtime Mr. Goudas employees, each invested $10,000 with him.
The two men may never see that money again. But with Jeevan Ponnampalam, they bought the Mr. Goudas trademarks and machines out of receivership. On a recent weekday, Jegarajah arrived in thick snow at Mr. Goudas carrying cans of paint and rollers. The team plans to rebuild the brand.
“All the suppliers were really upset,” Ponnampalam said. “Now, we have all the suppliers with us.” Adds Jegarajah: “We know how strong the name is. And we don’t want to give up.”
Simmonds’ s criminal cases return to court in Bracebridge on Feb. 7 and in New market on March 2. More than a dozen civil cases involving Simmonds remain before the courts. The Post could not find a defence filed by Simmonds to any of the civil suits.
HE WOULD BANG ALL THIS STOCK UP AND EVERYONE ELSE WOULD HAVE ESCROW. THE STOCK GOES DOWN TO PALOOKAVILLE AND YOU ARE LEFT HOLDING THE PAPER. I LOST TENS OF THOUSANDS OF DOLLARS, BUT I STILL RESPECT THE GUY. — IAN MACDONALD HE’S A ROGUE AS OPPOSED TO A CROOK.