Appeal from the Notice of Proposal of the Registrar, Alcohol Gaming and Racing to Refuse an Application for a Liquor Sales Licence pursuant Liquor Licence Act.
Between:
District 45 Inc.
Appellant
and
Registrar, Alcohol Gaming and Racing
Respondent
DECISION and ORDER
ADJUDICATOR: Stephen Scharbach, Member
APPEARANCES:
For the Appellant: Noel Gerry, Counsel
For the Registrar: Rob Sidhu, Counsel
HEARD VIA VIDEOCONFERENCE: February 25, 2021
DATE OF DECISION and ORDER: April 15, 2021
OVERVIEW
1This is an appeal from a Notice of Proposed issued by the Registrar, Alcohol Gaming and Racing (“Registrar”), to refuse an application by District 45 Inc. (“appellant”) for a liquor sales licence under the Liquor Licence Act (“Act”).
2The Registrar proposes to refuse the application on the basis that having regard to the past conduct of one of the appellant’s officers and directors, there are reasonable grounds to believe that the appellant will not carry on its business in accordance with the law, or with integrity, honesty.
3After considering the evidence and submissions provided by the parties, I conclude that the appellant’s application for registration should be denied, and I have directed the Registrar to carry out the proposal to refuse registration.
THE LAW
4Under the Act, an applicant is entitled to be issued a liquor sales licence except in specified circumstances including those where the past conduct of an officer or director of the applicant,
…affords reasonable grounds for belief that the applicant will not carry on business in accordance with the law and with integrity and honesty.1
5If the Registrar proposes to refuse an application for a licence, the Registrar must give the applicant written notice, including reasons for the proposed refusal and notification of a right to a hearing before this Tribunal.
6If a hearing is requested, the onus is on the Registrar to prove the facts which support refusal of the licence. After holding a hearing, the Tribunal may direct the Registrar to not carry out the proposal or carry out the proposal in whole or in part, and with any changes that the Tribunal considers appropriate, and may direct the Registrar to approve the application.2
THE ISSUE
7The Registrar alleges that the past conduct of Ikponwosa Enehikhare, one of the appellant’s officers and directors, affords reasonable grounds for belief that the appellant will not carry on business in accordance with the law and with integrity and honesty.
8That conduct is Mr. Enehikhare’s alleged membership in the Neo-Black Movement (“NBM”), an organisation originating in Nigeria that allegedly carries out and facilitates criminal activity, mainly fraud. The appellant and Mr. Enehikhare deny that Mr. Enehikhare is a member of the NBW. Thus, the issues in this case are:
- Is the NBM an organisation that carries out and facilitates criminal activity?
- Is Mr. Enehikhare a member of the NBM?
- If so, does Mr. Enehikhare’s membership in NBM afford reasonable grounds for belief that the appellant, if granted a liquor sales licence, will not carry on business in accordance with law and with integrity and honesty?
ANALYSIS AND FINDINGS
A. Issue # 1 The Neo Black Movement
9Based on evidence called by the Registrar, I am satisfied on a balance of probabilities that the NBW is a structured, hierarchical, organization whose main purpose and activity consist of conducting and facilitating crime, notably fraud, and transferring and distributing the proceeds of that crime.
10The Registrar relied on the testimony of Detective Constable Tim Trotter of the Toronto Police Service (“TPS”). DC Trotter was seconded to the TPS’s Financial Crime Unit-Mass Marketing Section from December 2014 to May 2018. He testified that in the course of investigating mass marketing and other frauds in Ontario, the Financial Crime Unit attempted to trace the proceeds of the crime and found that in many cases money was being funneled from victims in Canada through a network of bank accounts around the world. Apparently unrelated cases revealed common links and connections. Analysis of those links revealed that the common nexus between many of the crimes and individuals under investigation was a criminal organization known as the Black Axe or the NBM.
11DC Trotter studied the NBM including its origins, organization, structure, activity and personnel in Ontario. He summarized his information into a 27-page Analysis Report, a copy of which was made an exhibit.
12According to DC Trotter’s report, the NBM is the present name of a Nigerian based criminal organization formerly called Black Axe. Black Axe was originally a university-based fraternity-like social organization active in Nigeria. However, over time its role and direction changed, and it is now synonymous in Nigeria with street gangs, violence and criminality. A report published by the Immigration and Refugee Board of Canada reviewed Black Axe violence in Nigeria in 2009-2012 and noted that it was involved in kidnapping for ransom, violent clashes with rival organizations resulting in many deaths, and its members were recruited as thugs for politicians.
13According to DC Trotter’s report, Black Axe re-branded itself as the NBM to avoid the general perception of criminality and violence that had become associated with it. To create a veneer of legitimacy, the NBM adopted some of the postures of a political/social organization devoted to advancing the interests of Black people. However, many members of the NBM are former members of Black Axe and the NBM maintains much of the iconography used by the Black Axe including its original logo. The two organizations are synonymous to Nigerians and members of the worldwide Nigerian community.
14According to DC Trotter, the NBM is essentially a criminal organization set up to commit fraud and other crimes. The organization provides links to members worldwide who can be relied upon to facilitate crime and assist in transferring, laundering, and distributing the proceeds. The NBM has a hierarchical structure and a clearly delineated chain of command which reports to the “National Head” in Nigeria.
15Membership in the NBM is granted after an initiation process. Members maintain a distinctive manner of formal dress – including the prominent use of NBM colors - black and yellow - and insignia (including an axe and a stylized number 7), displayed on black berets, buttons and scarves. According to DC Trotter, those colors and insignia are distinctive features of the NBM uniform standard of dress and are displayed at official functions and in altered form at many social events. DC Trotter testified that like biker gangs in Ontario, only members of the NBM are permitted to wear its insignia.
16The NBM has an established presence in Nigeria but also in international Nigerian communities including those located in Africa, Asia, the USA and Canada. It has created organizational regions (“Zones”) which report to and communicate with the National Head. Each Zone has its own membership, executive, and hierarchy and provides financial support the National Head. NBM’s public image is advanced through legitimate media, social media and the publication of a magazine distributed to members. Police information indicates that in or around 2005, NBM organized a Canada Zone, apparently centered in the GTA, and more recently a Vancouver Zone has been established with an estimated 60 members.
17According to DC Trotter, once the Financial Crimes Unit understood NBM’s character as a criminal organization, a review of separate police investigations, occurrence reports and witness statements revealed some of the NBM’s activity in Ontario. DC Trotter’s report summarizes police reports which describes NBM member involvement in incidents in Ontario including:
- Assaults by NBM members after which witnesses would not co-operate with police investigations,
- Kidnapping, forcible confinement
- Mass marketing fraud, money laundering
- Funds from fraud committed in the US routed by NBM members and received by them in their Toronto bank accounts,
- Direct communication and flow of funds between the principal suspects under investigation for fraud in the US and a NBM associate in the Canada Zone
- Documentation establishing connections between NBM members and known victims of fraud.
18I find that DC Trotter’s evidence with respect to the essentially criminal character of the NBM to be credible and it was not seriously disputed by the appellant. I also note that two separate decisions of the federal Immigration and Refugee Board concluded, partly on the basis of evidence provided by DC Trotter, that the NBM is a criminal organization engaged in a variety of crimes including scams run by people in Canada against US citizens. In the 2019 case of the Ministry of Public Safety and Emergency Preparedness v. Peter Alika, the Board stated,
The NBM has committed crimes across the world. Nigeria, Italy, Canada and the USA. “They’re involved in drug trafficking, arms trafficking, racketeering, and killing is second nature” states Jonathan Matusitz, University of Central Florida Prof. who has studied Nigerian gangs.
After a review of the documentary evidence, I am satisfied that the BBM/BA is a criminal organization. The types of offences it engages in lends to the inclusion in the definition of organized criminality. There is a transnational component to the offences committed, scams run by people in Canada against US citizens.3
19In the 2017 case of Canada v Uthman, the Immigration and Refugee Board stated,
“...I find that the organization’s main purpose is to engage in criminality, mostly of a fraudulent nature but also involving violence and intimidation.4
20In summary, based on DC Trotter’s evidence, I conclude that the NBM is an organization whose main purpose is to engage in and facilitate criminal activity, mainly fraud.
B. Issue # 2- Is Ikponwosa Enehikhare a member of the NBM?
21While Mr. Enehikhare does not vigorously contest that the NBM is a criminal organization, he denies that he is a member.
22Based on the evidence presented, I find on a balance of probabilities that Mr. Enehikhare is a member of the NBM.
23The Registrar relied on the evidence of DC Trotter. DC Trotter testified that in conducting the research that culminated in his Analysis Report, the TPS surveyed and monitored the social media of known members and associates of the NBM. An analysis of that social media led him to the conclusion that Mr. Enehikhare is a member of the NBM.
24The evidence supporting that conclusion primarily consists of 5 photographs gathered by DC Trotter during the inquiries associated with his Analysis Report. The photographs depict Mr. Enehikhare at an NBM event, wearing the NBM logos or dress colors, and in association with other known NBM members. They consist of the following.
25Sick Kids Hospital Photo - A photo of 14 individuals, including Mr. Enehikhare standing behind a banner proclaiming the Neo-Black Movement of Africa – North America. The photo was taken at the Sick Kids Hospital Toronto when the NBM contributed to a toy drive. According to DC Trotter, the picture was posted on NBM social media in June 2013 with a false claim that NBM was in “partnership” with Sick Kids Hospital and was intended to lend the organization legitimacy. Photos such as this are featured prominently on NBM social media and have been used by NBM Zones throughout the world. Eight members of the group behind the banner (although not Mr. Enehikhare) are wearing black berets with an NBM logo. All members of the group are wearing white shirts. According to DC Trotter, Mr. Enehikhare’s presence behind an NBM banner at a staged NBM public relations event is a strong indication that he is an NBM member.
26According to DC Trotter, one of the members of the group in the photo is Akohomen Ighedoise, a listed director of the NBM of North America (Canada) and, according to police intelligence, the bookkeeper for the NBM Canada Zone.
Mr. Ighedoise was arrested in August 2014 for fraud offences relating to possession of a credit card not in his name. Judicially authorized searches showed NBM related communications including instructions to other alleged NBM members on how to engage in on-line fraud and notations regarding the flow of funds including the identities of known fraud victims. According to DC Trotter’s Analysis Report, Mr. Ighedoise was a principal in a local half million-dollar “romance scam” fraud and was linked to a broader international money laundering network under investigation by the FBI.
27Also present behind the banner with Mr. Enehikhare was Peter Alika who, according to the 2019 decision of the Immigration and Refugee Board referred to above, was a member of the NBM, which the Board determined was a criminal organization. The Board ordered the deportation of Mr. Alika from Canada for that reason.
28Photo of Mr. Enehikhare in a black suit and yellow tie. A second photograph depicts Mr. Enehikhare dressed formally in a black suit, white shirt and yellow tie. According to DC Trotter that is the distinctive manner of formal dress of the NBM and is consistent with Mr. Enehikhare’s membership in the NBM.
29Photo at Citizenship Ceremony. A third photograph was apparently taken right after the ceremony in which Mr. Enehikhare was granted Canadian citizenship on November 14, 2014. The photo shows Mr. Enehikhare displaying his newly granted citizenship certificate in the company of 5 other male individuals. They include:
- Osayi Omoruyi who, according to DC Trotter, is an identified member of NBM who was arrested by Toronto Police in June 2016 pursuant to an extradition request and in 2016 was extradited to the US for his role in a transnational mass marketing fraud involving persons in the US and Africa which victimized US citizens.
- Kunle Adewusi who, according to DC Trotter’s Analysis Report, is a member of NBM and was listed as editor of the Canada Zone version of the NBM magazine.
- Mr. Irabor (first name unknown) who has been charged with a number of offences including fraud in Vancouver.
30Photo Taken in a Bar/Restaurant. A fourth photograph depicts Mr. Enehikhare standing with 4 other male individuals apparently in a bar or restaurant. The date the photo was taken was unknown but, according to DC Trotter it was taken from social media associated with the NBM. Of the four individuals with Mr. Enehikhare, three of them are known members of the NBM – Mr. Omuruyi, Mr. Adewusi, and Mr. Irabor.
31According to DC Trotter those photos are evidence of Mr. Enehikhare’s association with known members of the NBM and, together with the other photos, suggests that Mr. Enehikhare is also an NBM member.
32Photo of Mr. Enehikhare wearing a black Beret with NBM Logo in March 2015. The fifth photograph was taken by police surveillance of a funeral for an identified NBM member in March 2015. According to DC Trotter’s report, the funeral was attended by NBM members from across Canada. When the hearse was loaded many of the attendees donned regalia associated with the NBM and Mr. Enehikhare was photographed wearing a black a beret with a stylized number 7 – an NBM logo. According to DC Trotter, the fact that Mr. Enehikhare is wearing the NBM beret indicates that he is a member - from DC Trotter’s knowledge of the organization, only members would be allowed to wear NBM regalia.
33Mr. Enehikhare testified that he is not and never has been a member of the NBM. He is 28 years old and immigrated to Canada in 2009 from Nigeria. After studying business administration, he started a business promoting parties and events at night clubs.
34Mr. Enehikhare testified that he also began playing soccer during the summer with other members of the African community. According to Mr. Enehikhare, many of the individuals depicted with him in the photos are just acquaintances he met through playing soccer. He testified that he was unaware of the nature of the NBM as a criminal organization or the alleged criminal activity of the people who are depicted in the photos with him.
35With respect to the Sick Kids Hospital photo, Mr. Enehikhare testified that he attended a soccer game and then afterwards went to a bar with some of the other players. According to Mr. Enehikhare, he went to the bar to distribute flyers for an event he was promoting. Some of his soccer acquaintances were going from the bar to the Sick Kids Hospital for what he understood was a charity event and he went there intending to distribute flyers to promote his event.
36While at the hospital he was photographed in front of the NBM banner with others, some of whom were wearing NBM regalia. According to Mr. Enehikhare he did not know anything about the NBM, or that some of those in the photo were involved in criminal activity - he was there primarily to distribute flyers and promote his event.
37With respect to the photo of Mr. Enehikhare in what DC Trotter described as NBM formal dress - black suit and yellow tie - Mr. Enehikhare testified that the photo was taken on his way to a wedding and was posted by him on his own social media. He was a groomsman at the wedding and all groomsmen were instructed to wear a black suit and yellow tie.
38With respect to the photo of Mr. Enehikhare and others at his citizenship ceremony, Mr. Enehikhare testified that the only one in the photo with whom he was friendly was Mr. Omoruyi whom he had met in Toronto through soccer and was from the same community in Nigeria. The others were at the ceremony to support someone else although Mr. Enehikhare was acquainted with them through soccer. According to Mr. Enehikhare, he was not aware that Mr. Omoruyi or the others depicted in the photo were involved in criminal activity.
39Mr. Enehikhare testified that the photo of him in a bar with 4 others was taken around the time as the citizenship ceremony. It was taken at a bar that he promoted. According to Mr. Enehikhare, the owner would take pictures like this and post them to social media to promote the bar. Mr. Enehikhare is depicted in the photo with four individuals, three of whom DC Trotter testified were known NBM members. Mr. Enehikhare testified he did not know that any of them were NBM members or engaged in criminal activity.
40Finally, Mr. Enehikhare testified with respect to the photo of him wearing a black beret bearing the NBM logo at the funeral of an NBM member. He stated that the deceased person was a musician known in the African community and known to Mr. Enehikhare through his promotion work. The people attending the funeral were given items such as T shirts, cups and berets commemorating the deceased. Mr. Enehikhare testified that he was given the beret and he put it on, as did other people. He testified that he did not ask about its meaning and it was not explained to him. He was unaware that the stylized number 7 on the beret was an NBM symbol.
41After careful consideration, I conclude that the Registrar has established on a balance of probabilities that Mr. Enehikhare is a member of the NBM. That conclusion is based on the totality of the evidence – DC Trotter’s testimony and the 5 photographs.
42Mr. Enehikhare testified that he attended the NBM Sick Kids Hospital event and donned the NBM beret with logo at an NBM member’s funeral without knowing about the NBM or the activity of its members. In the circumstances of this case I find that difficult to accept. According to DC Trotter, whose evidence I accept, NBM is well known in Nigeria where it is synonymous with criminal activity. It is also well known in expatriate Nigerian communities including the one located in the GTA.
43Mr. Enehikhare appears to be intelligent, engaging and was apparently active in his community networking and promoting events. I consider it unlikely that Mr. Enehikhare would attend the Sick Kids Hospital event and pose in front of the NBM banner, apparently lending his support, without knowing the nature of the organization or even asking any questions. I think it more likely that Mr. Enehikhare attended the event to display his support for the NBM in a public relations exercise.
44Similarly, I consider it unlikely that Mr. Enehikhare would don the NBM black beret with logo at the funeral of an NBM member without appreciating its significance. In fact, according to DC Trotter, no-one would be allowed to wear the NBM beret at public event without being a member.
45The photo that depicts Mr. Enehikhare a celebratory pose with known NBM members at his citizenship ceremony is also significant. Their attendance at an important event in Mr. Enehikhare’s life suggests a closer relationship with them than he describes and is consistent with Mr. Enehikhare’s membership in the NBM. The photos of Mr. Enehikhare in a bar posing with several of the same NBM members further suggests that Mr. Enehikhare has a relationship with NBM members.
46In my view, when the photos are considered in their totality, and along with DC Trotter’s evidence regarding NBM’s practices, they establish on a balance of probabilities that Mr. Enehikhare is an NBM member.
47The appellant argues that even if I find that Mr. Enehikhare was an NBM member, the main evidence in support of that conclusion – the photographs – were taken before 2016. The Registrar presented no evidence that Mr. Enehikhare has participated in NBM events or associated with NBM members since then. The appellant essentially argues that even if Mr. Enehikhare was an NBM member around 2015 there is no evidence that he is presently a member.
48While it is true that the photographs are now over 5 years old, in my view they establish Mr. Enehikhare’s membership in the NBM. No more recent evidence was presented that suggest either continued NBM membership or termination of membership. In light of my positive finding that Mr. Enehikhare is a NBM member, I would require some evidence besides the passage of time to conclude that Mr. Enehikhare is no longer a member. No such evidence was provided - Mr. Enehikhare takes the position that he was not a member in the first place. However, based on the evidence presented, I conclude that Mr. Enehikhare is a member of the NBM.
C. Issue # 3 - Reasonable Grounds
49Ultimately, the issue for the Tribunal is whether Mr. Enehikhare’s past conduct - specifically his membership in the NBM - affords reasonable grounds for belief that the appellant will not carry on business in accordance with the law and with integrity and honesty. I conclude that it does.
50The Supreme Court of Canada and the Court of Appeal for Ontario have considered what constitutes “reasonable grounds for belief” in circumstances such this and they have set out the following principles.
51Firstly, the test requires an examination of the past and present conduct of the applicant to see if there are reasonable grounds for belief that the applicant will not carry on business with honesty, integrity and in accordance with law. The Registrar is entitled to rely on any past conduct - whether in the operation of a licensed establishment or not, and whether it is criminal or not.5
52Secondly, the standard of proof required to establish reasonable grounds for belief is lower than the balance of probabilities standard. In other words, the Registrar does not need to establish that Mr. Enehikhare’s past conduct makes it more likely than not that the appellant will not operate in accordance with law and with integrity and honesty. The Registrar need only establish that there are “reasonable grounds” for that belief. “Reasonable grounds” require something more than mere suspicion but will exist where there is an objective basis for the belief based on compelling and credible information.6
53In this case the Registrar has established an objective basis for that belief. Mr. Enehikhare’s membership in the NBM, which I have found to be an organisation devoted to carrying out and facilitating criminal activity both in Ontario and elsewhere, provides reasonable grounds for belief that the applicant will not carry on business in accordance with law and with integrity and honesty.
54As a result, I have directed the Registrar to carry out the proposal to refuse the appellant’s application. The appellant suggested that a condition forbidding known NBM members from attending the premises may be appropriate. However, given the seriousness of my findings, I am of the view that conditions would not be sufficient to protect the public.
ORDER
55Pursuant to s. 23(11) of the Act, I direct the Registrar to carry out the proposal dated December 7, 2020 (Notice of Proposal No. 113065) to refuse the application of District 45 Inc. for a liquor sales licence.
LICENCE APPEAL TRIBUNAL
Stephen Scharbach, Member
Released: April 15, 2021
Footnotes
- The Act, s. 15, 6(2)(d)
- The Act, s. 23(11)
- 2019 CanLII 82160 (CA IRB) at paragraph 32,33
- 2017 CanLII 143172 (CA IRB), at page 20
- Ontario (Alcohol and Gaming Commission of Ontario v. 751809 Ontario Inc. (Famous Flesh Gordon’s), 2013 ONCA 157, paragraph 26-31
- Mugesera v. Canada (Minister of Citizenship and Immigration) 2005 SCC 40, [2005] 2 S.C.R. 100 at paragraph 114