Court Information

Ontario Court of Justice

Her Majesty the Queen against Albert Rosenberg

Sentencing Decision

Before: The Honourable Mr. Justice W. Horkins

At: Toronto, Ontario

Date: October 11, 2013

Appearances

For the Crown: M. Callaghan, Esq.

For the Accused: Self-represented

Reasons for Sentence

Introduction

These are my reasons for sentence in the matter of Albert Rosenberg.

Mr. Rosenberg appeared before me in custody on September 30th and pled guilty to eight counts of fraud, one count of possession of proceeds of crime, and one count of assault.

On the sentencing hearing, the Crown seeks a penitentiary sentence in the upper end of the range of 4 to 6 years.

Mr. Rosenberg is self-represented. He presents as an intelligent and articulate individual. His criminal history confirms his experience with court proceedings. He has represented himself in these sentencing proceedings and has been very direct in his acceptance of responsibility for these offences. In fact, he has expressly conceded that a penitentiary sentence is appropriate. He asks me to consider a sentence less than that sought by the Crown, something in the range of 4 to 5 years.

Criminal History

Mr. Rosenberg is, to put it bluntly, a serial fraud artist. His criminal record is filed as Exhibit 3 in the proceedings.

In summary:

• In 1988, he was sentenced to a total of 4 years with respect to certain fraud convictions.
• In 1991, he was again convicted of a collection of frauds and sentenced to a consecutive 3-year term.
• He was apparently paroled in 1994, and about 5 months later, again sentenced to 2 years for crimes of dishonesty and re-committed to the penitentiary.
• Shortly thereafter, a few months later, he was convicted of further fraudulent offences and received a further sentence. The sentences would appear to all merge, but resulted in his release from the penitentiary in 2005.
• In 2006, he was re-committed on a 3-year sentence for fraud and related convictions.
• He was released in the summer of 2009.
• Re-committed for a statutory release violation in February of 2010.

Facts of the Current Offences

A summary of the facts which were acknowledged on the plea and on the sentencing hearing are filed before the court and marked as Exhibit 2 in these proceedings. The facts set out are essentially the summary contained in the Record of Arrest. They were expressly agreed to by Mr. Rosenberg on his plea.

The Fraudulent Scheme

In brief, Mr. Rosenberg created a fictional persona as a member of the Swiss nobility and the heir to a large fortune. He presented himself successfully as a sophisticated financial advisor and promised potential investors and contractors great success and great returns on their investments. He cultivated a network of moneyed individuals prepared to invest with him and, in fact, to refer others.

Victims

Michaela Zavoianu

The most direct victims of his constellation of schemes begin with Michaela Zavoianu, whom he met on a dating website in 2009. They dated for a few months until the relationship was interrupted by Mr. Rosenberg being re-committed to the penitentiary for a parole violation. He told Ms. Zavoianu that he was in jail for unpaid taxes. When he was released, the relationship continued. They moved in together, and over the next year or so, he set up a holding company. He made her the President and Director of the Company and convinced her to cash her retirement savings and turn over a total of $80,000.00 to him for investment. Not only did the money disappear, but, in a sense, so did Mr. Rosenberg because during this time he struck up a relationship with another woman, Antoinette Larizza.

Antoinette Larizza

This charade was essentially the same. He was a wealthy Swiss Baron who would show her the good life. He convinced her to sell her home and move in with him, to turn over the proceeds of the sale of this home to invest in a trust fund which would be for her benefit. Ms. Larizza eventually became aware that all was not right. There was another woman's name on the corporate documents of the holding company. She made further inquiries and discovered, it would seem gradually, that Mr. Rosenberg was a fraud.

Prior to discovering the whole truth, she confronted Mr. Rosenberg. He reacted physically. In anger, he squeezed her arm sufficiently to leave bruising. As part of these proceedings, he has pled guilty to this domestic assault.

Ms. Larizza's total loss financially is listed as $155,000.00.

Ms. Larizza delivered a Victim Impact Statement orally in court at the sentencing hearing. It is entered in written form as Exhibit 5 in the proceedings. Her comments were articulate and compelling, and her statement illustrates the deep psychological injury that is, quite frankly, often overlooked when the courts consider sentencing in so-called "property offences." Considering all that Ms. Larizza has been through as a victim, no one can question that the damage done by these offences for all the victims, but in particular Ms. Larizza, goes deeper and further than mere dollars and cents.

The frauds here were perpetrated against vulnerable individuals and are crimes of considerable gravity. These two frauds are breaches of trust. They must be responded to by the courts with meaningful consequences.

Commercial Frauds

In addition to the frauds perpetrated on these two women and over the same period of time, Mr. Rosenberg committed a variety of commercial frauds, which are the subject of the other counts. There is a chart filed as Exhibit 1 in these proceedings setting out those victims and their respective financial losses. The total taken together is a million dollars.

• CBRE is described as a project management company which Mr. Rosenberg retained to assist in setting up the head office for his holding company. They suffered a loss of just over $20,000.00.

• John Hunt was retained to set up a trust fund for Ms. Larizza. He was convinced to invest $300,000.00 of his own in the holding company. The money is gone.

• HOK Designs was hired to provide design services for this supposed head office. Their out-of-pocket loss was over $150,000.00.

• Italinteriors was to make custom-made furniture for the office. They suffered a loss of over $340,000.00.

• Vincent Zaffino placed money with the accused for investment. His loss is listed as $100,000.00.

It is agreed as part of the facts that none of these funds were invested or applied to the uses for which they were solicited, but were rather spent by the accused to support his lavish lifestyle.

At the time of his arrest, he was in possession of $2,509.96 and a Porsche sports car, and those assets have been seized and forfeited.

Legal Framework for Sentencing

Principles of Sentencing

Section 718 of the Criminal Code now provides a convenient framework for consideration of the applicable purposes and principles of sentencing. The fundamental principle is that a sentence must be both proportionate to the gravity of the offence and the degree of responsibility of the offender.

The mandate of s. 718 is to impose a "just sanction," a sanction that advances the objectives of, amongst other things, adequately denouncing unlawful conduct, deterring an offender specifically as well as other like-minded individuals generally, and to separate offenders from society where that is necessary.

It is also one of the purposes of sentencing to try and facilitate the rehabilitation of offenders where there is potential to do so, and to provide reparations to victims when that is possible. All of this, as well, is to try and promote a sense of responsibility in the offender and an acknowledgement of the harm done to victims and to the community.

Totality Principle

When crafting a sentence dealing with a constellation of offences that are intertwined, the court must also consider the totality of the consequences to the offender. The most serious offences before me here are, without question, the breach of trust frauds committed against Larizza and Zavoianu. The other more commercial frauds are, without question, matters of considerable gravity as well.

Fraud Sentencing Provisions

Section 380 of the Criminal Code deals with sentencing in fraud and fraud-like offences. It provides a maximum penalty of 14 years imprisonment for each fraud over $5,000.00.

The more recent subsection (1.1) now provides for a minimum mandatory jail sentence of 2 years where the total subject matter of a fraud or related frauds exceeds 1 million dollars. That mandatory minimum came into existence during the currency of some of the fraudulent activity before me, but whether or not it actually applies to this accused is completely academic because clearly the appropriate range of sentence here is in excess of that mandatory minimum. But at the very least, the creation of that subsection evidences Parliament's intention that crimes of this magnitude be dealt with with an emphasis on denunciation.

Aggravating Circumstances

Section 380.1 prescribes certain statutorily aggravating circumstances to be considered in sentencing for fraudulent activities. That subsection codifies the common law and prescribes that circumstances aggravating sentence include the "magnitude, the complexity, the duration, and the degree of planning" in a fraud, as well as the number of victims, the degree of impact on the victims given their personal circumstances, and, again, expressly whether the value of the fraud exceeds 1 million dollars.

Comparative Case Law

The Crown has provided me with three reported cases for assistance in this matter.

R. v. Johnston

R. v. Johnston, [2013] O.J. No. 4087 involved an accused pretending to be an investment banker who gave a bad cheque for over $20,000.00 to pay his hotel bill. He had been staying at the hotel during the currency of his fraudulent activities. That accused was on bail at the time of the offence. He had a lengthy related criminal record. In fact, it would appear he was serving a fraud sentence at the time of the offence. He was characterized by the court as an "incorrigible fraudsman" and he was sentenced to 4 years, and that was following a contested trial.

R. v. Deutsch

R. v. Deutsch, [2005] O.J. No. 5542, the Ontario Court of Appeal approved a sentence of 4 years imposed following a trial of a con-artist masquerading as a middle-man for Saudi oil interests, defrauding his victims of well over $100,000.00. That accused can also be characterized as a serial con-artist from whom the public was in need of protection.

The Court of Appeal characterized the 4-year sentence as "not excessive" but "if anything lenient."

R. v. Downey

The third case is R. v. Downey, the decision of Justice Hill, sentencing an accused to a global 6-year penitentiary term for a variety of offences which are not terribly dissimilar to those before me.

It is worth noting, as a bit of an aside, that this is a decision from back in 2003 and so pre-dates many of the statutorily aggravating circumstances and guidelines that Parliament has now moved into the Criminal Code.

Patricia Downey passed herself off to her victims as a wealthy heiress with considerable assets. Those assets had been frozen in the wake of her husband's recent death. All of this was false, but believed by her victim, 85-year-old Reginald, who tried to help her by providing her with an unsecured $239,000.00 loan. Ms. Downey had a history of strikingly similar fraudulent behaviour. In short, again, she was a serial con-artist.

There were other victims in the proceedings before Justice Hill who lost life savings, together with the manifest psychological injury, loss of reputation, and dignity.

It would also appear in that case, from the comments of Justice Hill, that there was some serious concern about Ms. Downey's mental well-being.

Analysis Framework

As with all of these cases, which are marked with planning, pre-meditation, and sophistication, one is almost forced to conclude that beyond the simple explanation of greed, there must be some deep psychological disorder at play, explaining, at least to some degree, the behaviour of these incorrigible fraud artists.

Beginning at paragraph 54 of the Downey decision, Justice Hill provides an analysis that is a useful framework for sentencing in cases such as this. Paraphrasing, he says the court should consider the nature and extent of the loss, the degree of pre-meditation, the accused's conduct after the fact, history of prior convictions, personal benefits generated to the accused, and the trust existing in the relationship between the accused and the victim, and the motivation underlying the commission of the offence. He also notes that the relative gravity of the offence can depend on its sophistication and complexity.

So these comments of Justice Hill back in 2003 really, in a sense, predict those factors being now codified in the provisions of the Criminal Code dealing with sentencing in cases such as this.

Individualized Sentencing

With those general principles in mind, it has to also be emphasized, of course, that sentencing for a criminal offence is a highly individualized exercise. An appropriate sentence must be determined on a case-by-case basis, depending on the unique facts and circumstances of both the offence and the offender.

There is great benefit to considering and being guided by dispositions in similar cases. In addition to the three cases that the Crown has provided me with that I have referred to, one of the benefits of Justice Hill's case is it, in fact, contains within it a series of cases summarized at paragraphs 63 through 67. All of those cases contain far less aggravating circumstances than the one before me and all resulted in penitentiary sentences.

Aggravating and Mitigating Factors

Aggravating Circumstances

Amongst the aggravating circumstances in this case are the following:

1. The accused before me is an incorrigible serial con-artist. This is evidenced both by his criminal history and the circumstances of these particular offences.

2. Although the accused was neither on bail nor parole at the time of these offences, he had only recently completed a lengthy penitentiary sentence for similar activity.

3. The frauds on Larizza and Zavoianu involve a significant breach of trust.

4. There is, before the court, a constellation of inter-related frauds.

5. These frauds were committed with considerable thought and sophistication.

6. These are frauds of considerable magnitude and complexity and involve a collective loss in excess of a million dollars.

7. Essentially no restitution has been provided.

8. Both the financial and psychological impact on the victims, as evidenced by the Victim Impact Statements before me, and as I have already said, in particular I reference the impact on Antoinette Larizza, who eloquently provided significant insight into the insult and psychological trauma inflicted on her by the accused.

9. Mr. Rosenberg expressly acknowledged that his motivation was greed.

10. The proceeds went to underwriting a lavish lifestyle.

Mitigating Factors

Balanced against these considerable aggravating circumstances, there are certain mitigating factors:

1. Mr. Rosenberg has pled guilty at the earliest opportunity.

2. He has accepted full responsibility for his conduct.

3. He has been direct and forthright in his cooperation following his arrest. He has in no way sought to deflect blame from himself.

4. He has expressed remorse.

5. He acknowledges the magnitude of his culpability and fully expects a significant penitentiary sentence.

6. He has expressed a willingness to make restitution, but, at the same time, acknowledges that he has no present ability to follow through on that stated intent.

Sentencing Decision

In conclusion, and in consideration of all of the above, it is my assessment that a global sentence of 5 years in the penitentiary is appropriate. I hasten to add that taken in isolation, each of these offences might be dealt with in a different fashion, and I expressly have taken into account the fact that this is a constellation of activity, and therefore viewed it as a case where the global nature of the disposition and the totality of it has to be considered in a significant fashion.

Subject to submissions, I would propose to attribute the sentence as follows:

• Fraud against Antoinette Larizza: 5 years
• Fraud against Michaela Zavoianu: 5 years concurrent
• Each of the other frauds: 3 years concurrent
• Possession of proceeds of crime (cash): 6 months concurrent
• Assault: 30 days concurrent

All of which I would consider to be an appropriate global sentence, as I said at the outset, of 5 years in the penitentiary[1].

Ancillary Orders

(Discussion of ancillary orders for restitution and DNA data banking omitted)

Certification

THIS IS TO CERTIFY that the foregoing is a true and accurate transcription of the recordings of MR. WASIQ ABIDY, as reviewed by Mr. Justice Horkins, to the best of my skill and ability.

Arlene Gorewicz Certified Verbatim Reporter

[1] Less one month credit for pre-sentence custody.