Sentenced and Bail

People wonder why these two fraudsters got bail immediately after they were sentenced. I’ll be happy to explain.

Their lawyers (the Greenspans, who do high profile cases and who are pricey lawyers which sometimes means squat) submitted their application for appeal a week prior to the Court of Appeal, they were found guilty a while back, but were waiting for sentencing which happened today. Since their application for bail pending appeal was done in advance and approved, when they were sentenced today, the application was all set and the bail had been prearranged and granted. So the courts have to release them. Bail is only granted when the Appeal Court believes there are good grounds for an appeal, otherwise they wouldn’t of granted them bail most times and of course the type of crime it is. Their bails were set at $350,000.

Bail pending appeal takes about 1 week, and if you’ve got a slow acting lawyer, 2 weeks. Their lawyers obviously had this all arranged so that their clients won’t have to step foot inside a jail.

Except for a few cases.When it comes to sentencing Canada’s sentencing guidelines are not set on what the deserved punishment is but rather how much of a threat to society the offender is and how long rehabilitation if any the offender would benefit from. If one is sentenced on the greater scale of the guidelines, it can be for the following reasons and which are not limited to; the judge is pissed, he wants to make an example out of you (which can be a good reason for an appeal), your lawyer dragged the court case way too long and took up courts time which they hate, your lawyer pissed the judge off because of a previous case before yours, the judge is a crappy judge and knows nothing about the law and got where they are because they slept their way there.

It’s evident that there are no such thing as a rehabilitation program for fraudsters, unless there were other underlying issues that caused the crime, for example addictions, drugs etc where the offender would need help, then they would send them off to a rehabilitation centre that deals with that. That’s why if someone does big time fraud and is sentenced to the pen (2 years and up), they’ll get parole automatically and much sooner than being sentenced to the provincial system ( 2 years less than a day).

But in this case, it was lying and falsifying records on assets and bookkeeping etc, which is of course Fraud. Fraud is fraud. The community is outraged that these two got bail.

Anyway, they’re still wanted in the USA and if they have to serve 6 years, they get out in 1 year 6 months. Welcome to Canada.


Business Reporter

Livent founder Garth Drabinsky was released on bail this afternoon after being sentenced earlier to seven years in prison for an accounting fraud that propelled the theatre company onto the global stage before leading to its collapse.

Drabinsky’s business partner and co-defendant Myron Gottlieb was sentenced to six years and also released after the Ontario Court of Appeal granted them bail.

“The contributions Mr. Drabinsky and Mr. Gottlieb have made to society must be and are taken into account, but no one is above the law,” Ontario Superior Court Justice Mary Lou Benotto told their sentencing hearing in a downtown Toronto courtroom earlier today.

“No one gets to write his own rules.”

She said the length of the sentences is a message to “those in business and the community … that this will be the court’s response to corporate fraud.”

Drabinsky, 60, and Gottlieb, 65, were convicted in March on two counts of fraud and one count of forgery.

Today, Drabinsky was sentenced to four years for the first fraud conviction and seven years for the second, to be served concurrently.

Gottlieb was also sentenced to four years on the first fraud conviction, but to just six years on the second, with Benotto noting that he had been the victim of some “unfair allegations” and “caught in a wide net” meant for Drabinsky.

The forgery convictions against both men were stayed because the judge found that the facts underlying those charges were the same as those in the second count of fraud.

“This was not a one-time impulsive act but a systemic method of accounting involving employees and suppliers,” Benotto said. “The evidence at trial disclosed a myriad of people who suffered as a result of the fraud.”

Prosecutor Alex Hrybinsky had asked for prison terms of eight to 10 years, noting that neither man has shown remorse.

Benotto said the appropriate sentences were in the range of five to eight years. However, she took into account that Drabinsky has ongoing health problems, Gottlieb has lost his home and ability to work, and that each has made contributions to the community.

Both men claimed to have been framed by employees.

Defence lawyers Edward and Brian Greenspan had argued that their clients should be sentenced to two years less a day of house arrest, followed by three years’ probation. They proposed the pair could serve the community by talking to university students about business ethics.

“This sends a very clear message to corporate Canada and the investment community — we have rules here and if you don’t play by them, you will pay the consequences,” said Richard Powers, director of MBA programs at the Rotman School of Business at the University of Toronto.

Benotto found that Drabinsky and Gottlieb masterminded a scheme of fraudulent accounting that started in 1989 when the Livent was still private, and used those methods to keep it afloat as a publicly traded company from 1993 to 1998.

They misallocated pre-production costs to fixed assets, and hid expenses by moving them to future quarters and from one show to another, the judge ruled.

The Crown argued that the scheme made the company seem more profitable than it was, and helped attract $500 million in loans and investments. It fell apart when a group of U.S. investors, led by Hollywood mogul Michael Ovitz, took over Livent and uncovered the phoney accounting. The value of Livent’s shares plummeted, and within four months, the firm collapsed.

In asking for a conditional sentence, the defence presented dozens of letters from actors, directors and writers, lauding the impact that Livent — and especially Drabinsky — had on live, Broadway-style theatre in Toronto.

Livent’s roster of blockbusters included Phantom of the Opera, Ragtime, Showboat, and Kiss of the Spider Woman, which won three Tony Awards including best musical. The shows helped create a thriving theatre industry in the city that added millions of dollars to the local economy and attracted worldwide acclaim.

The trial, which started on May 5, 2008, saw 14 witnesses and 237 exhibits, and produced more than 7,000 pages of transcripts.

In 1999, the U.S. Attorney’s Office in Manhattan indicted Drabinsky and Gottlieb on fraud and conspiracy charges, which are still pending.

In 2001, the Ontario Securities Commission filed charges against Drabinsky and other Livent executives. Those proceedings are on hold.

With files from Daniel Dale

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