CITATION: R. v. Marziliano, 2016 ONSC 7608
COURT FILE NO.: CR-15-70000088-0000
DATE: 20161206
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
HER MAJESTY THE QUEEN
– and –
GARNET MARZILIANO
Michael Lockner, for the Crown
Sam Goldstein, for Mr. Marziliano, Defendant
HEARD: November 7, 8, 9, 2016
R.F. GOLDSTEIN J.
REASONS FOR JUDGMENT
[1] On February 14, 2011 at 10:49 am Garnet Marziliano, the accused, walked into a company called Guardian Gold. Guardian Gold is a gold dealer. He dealt with Walter Baici, the chief dealer. He tried to sell Mr. Baici a 10 ounce gold bar. The gold bar was called a Perth Mint 49, which means that it was almost 100% pure. The Perth Mint is a gold refiner in Australia.
[2] Mr. Baici was suspicious about the origin of the gold bar. He refused to buy it. Mr. Marziliano left. That particular gold bar was never recovered.
[3] The Crown says that the gold bar was property obtained by crime. Specifically, the Crown argues that it was the proceeds of a fraud. A stolen TD Bank draft was deposited into an account at the Royal Bank. The funds were then used to purchase gold in Montreal.
[4] Mr. Marziliano was not charged with the fraud. He is charged with possession of stolen property – the gold bar that he tried to sell. The Crown argues that Mr. Marziliano either knew or was wilfully blind that the gold bar was the proceeds of a fraud.
[5] The Crown’s case is entirely circumstantial. There is no direct evidence that the gold bar that Mr. Marziliano presented to Walter Baici at Guardian Gold was part of the same haul from the fraud. There is also no direct evidence that Mr. Marziliano was aware of the existence of the fraud.
[6] I must therefore determine the following issues:
(a) Was the gold obtained by the commission of an offence?
(b) Did Mr. Marziliano know that the gold was obtained by the commission of an offence?
(c) If not, was Mr. Marziliano wilfully blind?
ANALYSIS:
(a) Was the gold obtained by the commission of an offence?
[7] There does not seem to be any serious issue that the gold was obtained by the commission of an offence. In essence, two men named Raffi Ebrekdjian and Remy Boghossian created a fictitious person to buy gold using fraudulently obtained funds from the Royal Bank. This was the scheme:
[8] Sometime in January 2011, an unidentified person stole a TD Bank draft from a branch in Mississauga. The thief, who has never been identified, was apparently a TD employee.
[9] On February 2, 2011 Ebrekdjian obtained a cell phone with the number 647-270-3371. The subscriber was listed as ABC Inc. ABC was a non-existent company. It had an address of 21 Dundas Square, Suite 621. That was a non-existent address. Ebrekdjian is Mr. Marziliano’s father.
[10] At about the same time Boghossian, who was a lawyer, opened up a client file in the name of Omar Ali. Omar Ali did not exist. The file included forged documents in the name of Omar Ali. Omar Ali’s telephone number was listed in the file as 647-270-3371. That was the number of ABC.
[11] Thus, Boghossian opened up a file for a non-existent client. The client was associated with a non-existent company. The non-existent company and client were associated with a cell phone registered (and used) by Ebrekdjian.
[12] On February 10, 2011, at just after 10:00 am, Boghossian presented the stolen TD draft at a Royal Bank branch. The draft was endorsed for $1,895,751.00. The draft was made out to Boghossian’s law firm in trust. The RBC teller faxed a request for verification to the TD Bank. A false document was faxed to RBC verifying that the draft was legitimate.
[13] The Royal Bank teller, relying on the false verification, deposited the full amount of the fraudulent bank draft into Boghossian’s trust account. Boghossian instructed the teller to wire almost all the money to a company called Kitco Metals Inc. Kitco is a dealer in gold. Kitco is located in Montreal.
[14] On the same day, February 10, 2011, Ebrekdjian flew to Montreal. He met with a man named Christopher Dobson. Dobson provided his driver’s licence to Ebrekdjian. Ebrekdjian in turn provided that information to Boghossian. Boghossian then faxed a letter to Kitco. The letter stated that Dobson would be picking up gold. The letter provided Dobson’s date of birth.
[15] Dobson went into Kitco and picked up $989,670.00 worth of gold bars. The gold bars came from the Perth Mint, in Australia. The bars were of different sizes. Each of the bars had distinctive kangaroo markings.
[16] Dobson gave the bars to Ebrekdjian. Ebrekdjian took the train back to Toronto. Mr. Marziliano picked him at Union Station. They drove together to their home at 126 Mount Pleasant Road in Toronto.
[17] The next day, February 11, 2011, Boghossian flew to Montreal. He picked up $899,541.00 worth of gold bars. Like the first order, the gold bars making up this order came from the Perth Mint. The order was made up of 65 10 ounce gold bars. Again, each of the bars had distinctive kangaroo markings.
[18] That same day, February 11, 2011, the Royal Bank discovered the fraud. A corporate security investigator contacted Boghossian. The investigator told Boghossian that the TD Bank draft deposited into his trust account had been forged. Boghossian told the investigator that he had been acting on behalf of Omar Ali. He gave other false information to the corporate security investigator.
[19] A few days later, on February 14, 2011 (the same day Mr. Marziliano went to Guardian Gold), a man named Siva Suthakaran sold three 10 ounce Perth Mint bars (each with the distinctive kangaroo markings) to a man named Thebarajah Thampapillai. On February 16, 2011 Thampapillai tried to sell one of the gold bars to Express Gold Ltd. Express Gold is a gold dealer like Guardian Gold. The owner of Express Gold called the police. There had been a police bulletin about fraudulently obtained Perth Mint gold bars. The police attended, arrested Thampapillai, and recovered the gold bar. That was the only gold bar that was recovered.
[20] At around the same time, Ebrekdjian arranged to have several gold bars melted down. He arranged to bring several bars to a jewellery shop owned by a man named Arsenyi Danaciyan. The gold bars had the unique kangaroo marks. Danaciyan melted several bars for Ebrekdjian until he saw a news report about the fraudulently obtained gold bars. He refused to melt any more gold bars and called the police.
[21] Walter Baici, the chief dealer at Guardian gold, testified that there are hundreds of gold refiners around the world. Mr. Baici testified that Guardian only dealt with reputable refiners that are recognized by the London Bullion Association. Although the Perth Mint is a reputable refiner, at that point gold bars from Perth were very rare in North America. Baici had a very long career dealing in gold. When Mr. Marziliano brought the Perth Mint gold bar into Guardian Gold it was only the second time Mr. Baici had seen one. Dino Vannicola is the owner of Guardian Gold and was Mr. Baici’s boss. He also testified that he had rarely dealt with Perth Mint bars up to that point.
[22] I find beyond a reasonable doubt that the gold bar presented by Mr. Marziliano was property obtained by crime. I find that it was one of the gold bars obtained from Kitco in Montreal. I am satisfied beyond a reasonable doubt that the funds used to purchase the Kitco gold were obtained using the fraudulent TD Bank draft. I make this finding for these reasons: Perth Mint bars were obtained from Kitco on February 10 and 11, 2011. One of the people obtaining gold bars was Mr. Marziliano’s father, Ebrekdjian. Ebrekdjian and Mr. Marziliano lived together. They also worked together. Perth Mint Gold bars were comparatively rare at that time. There is a close temporal and familial connection between the gold bar presented at Guardian Gold and the gold bars fraudulently obtained from Kitco.
[23] I turn now to Mr. Marziliano’s role.
(b) Did Mr. Marziliano know that the gold was obtained by the commission of an offence?
[24] Crown counsel, Mr. Lockner, argues that Mr. Marziliano either knew or was wilfully blind that the gold bar had been obtained by the commission of an offence. I will deal first with actual knowledge.
[25] Mr. Lockner relies on circumstantial evidence that, he argues, shows that Mr. Marziliano had actual knowledge. I must respectfully disagree.
[26] It is obviously an important circumstance that Mr. Marziliano picked up his father, Ebrekdjian, from Union Station on February 10, 2011. That was the day Mr. Ebrekdjian flew to Montreal. He had Dobson pick up gold from Kitco. He then took the train back to Toronto with the gold. Mr. Marziliano and his father went to their home. It is not unreasonable to assume that Mr. Marziliano was aware that his father went to Montreal to pick up gold, considering that he himself presented a gold bar a few days later at a gold dealer. There is no evidence that Ebrekdjian told Mr. Marziliano anything about the fraud that took place at the Royal Bank, or that the gold was purchased with the proceeds of the fraud.
[27] On the day that Boghossian went to Montreal, February 11, 2011, Mr. Marziliano also went to Montreal. He took a Porter Airlines flight there and back. There is no admissible evidence as to what he did there.
[28] There is no evidence that Mr. Marziliano had contact with Kitco, the Royal Bank, or the TD Bank. There is no evidence that Mr. Marziliano was aware of the use of the fraudulent bank draft or the use of the Boghossian trust account. There is also no evidence that Mr. Marziliano had contact with Arsenyi Danaciyan, or was aware of Mr Danaciyan. Mr. Danaciyan was the jeweller that Ebrekdjian used to melt down the Perth Mint gold bars and subsequently called the police.
[29] Mr. Marziliano had previously done gold business with Guardian, according to the evidence of both Walter Baici and Dino Vannicola. There was no evidence that any of those previous dealings had involved criminal activity or the suspicion of criminal activity.
[30] Fraud, by its very nature, is meant to be a non-detectible crime. Unlike, say, bank robbery, a well-executed fraud will never be discovered, or will not be discovered until much later. A well-executed fraud also depends upon using innocent dupes who do not know they have been duped – like the unfortunate Royal Bank teller who became an unwitting part of the scheme, fooled by the forged draft and the fraudulent fax verification. The fewer people who know, the better.
[31] The strongest evidence the Crown relies on is the cell phone tower evidence. Ebrekdjian obtained the ABC cell phone on February 2, 2011. The phone was not used after February 13, 2011.
[32] On the morning of February 10, 2011, the ABC phone made and received calls and texts that were in the vicinity of the Telus cell tower at 1090 Don Mills Road. The important calls appear to have commenced at 9:57 am. The Royal Bank branch where the fraud was carried out was at 1090 Don Mills Road. Boghossian entered the branch at 10:06 am. At the same time Ebrekdijian’s phone made and received calls and texts that were picked up by the Bell cell tower at 1129 Don Mills Road. Boghossian left the Royal Bank branch at 11 am.
[33] I find that for the approximately one hour that Boghossian was at the Royal Bank branch at 1090 Don Mills Road Ebrekdjian was in close proximity and used his phone as well as the ABC phone. During that hour the Rogers cell tower at University and Dundas in downtown Toronto picked up calls made and received by Mr. Marziliano’s cell phone. 1090 Don Mills Road is not close to University and Dundas. Mr. Marziliano’s phone and Mr. Ebrekdjian’s phone exchanged five phone calls and one text during that hour. There were numerous calls between the Ebrekdjian cell phone and Boghossian’s cell phone during that hour. There were calls between the ABC phone and some of the other actors in the scheme as well as Boghossian. There was no contact between Marziliano or Boghossian’s cell phones at that time. The ABC phone was not used to communicate with Marziliano’s phone at that or any other time.
[34] Ebrekdjian flew on a Porter Airlines flight at 12:55 pm, arriving in Montreal at 2:13 pm. The gold was picked up from Kitco at 3:53 pm. Prior to the flight Ebrekdjian’s cell phone made several calls that were picked up by the Bell cell tower in the vicinity of Queen’s Quay in Toronto. Queen’s Quay is near Billy Bishop Airport. Ebrekdjian’s phone made several calls to individuals in Montreal while he was on the ground there. He also made numerous calls and texts to both Mr. Marziliano’s and Boghossian’s cell phones at the same time. His phone also made calls that were captured by cell phone towers between Montreal and Toronto, presumably while he was on the train. There were numerous calls and texts between Ebrekdjian and Mr. Marziliano throughout that day.
[35] While Ebrekdjian was in Montreal and later on his way back from Montreal on February 10, 2011 the ABC phone had multiple contacts with Boghossian’s cell phone. Cell tower evidence shows that the ABC phone and Mr. Marziliano’s phone were in reasonably close proximity.
[36] I draw the inference that Mr. Marziliano was in possession of the ABC phone while Ebrekdjian was in Montreal. But what does that mean?
[37] Of interest are texts between Siva Suthakaran and the ABC phone while it was in Mr. Marziliano’s possession. There were calls that were forwarded to voice mail. There is no evidence that Mr. Marziliano was able to pick them up or did pick them up. At 17:49 there was a text from Suthakaran to the ABC phone. The text read: “Call me now banker is getting out of control”. There was another text from Suthakaran at 18:57 that read: “why aren’t u answering call me”. There was another text at 19:29 from Suthakaran that read: “give me remy cell#”.
[38] I agree with the Crown that Mr. Marziliano would likely have seen these texts. There is, however, no record of a phone call by the ABC phone – or Mr. Marziliano’s phone – to Suthakaran until 19:43 that day. At that point there was a call lasting 187 seconds.
[39] Despite Mr. Lockner’s very careful analysis, I am simply unable to go as far as the Crown wishes. Although Mr. Suthakaran was clearly involved in the scheme, it is unclear what his role was, if any, on February 10, 2011. The Agreed Statement of Facts indicates that Mr. Suthakaran became involved on February 14, 2011, when he sold gold to Mr. Thampapillai through a middleman. Furthermore, it seems that Mr. Marziliano was not immediately picking up, or at least not responding, to calls or texts from Mr. Suthakaran. I am unable to impute knowledge of the underlying fraud to Mr. Marziliano based on these calls and texts from Mr. Suthakaran.
[40] What about the calls and texts between the ABC phone and Boghossian? Again, I do not think I can impute knowledge of the underlying fraud or criminal activity generally beyond a reasonable doubt. It is a reasonable inference that Mr. Marziliano was aware that his father went to Montreal to pick up gold, and it is also a reasonable inference that Mr. Marziliano was aware that it was on behalf of Mr. Boghossian. Mr. Marziliano’s phone was in contact with some of the phones that his father’s phone was in contact with. The purpose of those contacts is unknown. I am unable to draw an inference of knowledge based on the admissible evidence. That would put him in a similar position as the Royal Bank teller who cashed the fraudulent draft, received verification, and then transferred the funds to Kitco, a gold dealer, in the absence of further evidence.
[41] As for the calls between Mr. Marziliano and his father, Ebrekdjian, I have no difficulty drawing the inference that they must have discussed the Perth Mint gold. I have a great deal of difficulty with the notion that the frequent calls and texts between them demonstrate actual knowledge of the fraudulent scheme, or at least knowledge that the gold was obtained by crime. The two lived together. They were in business together. It is impossible to say how much of their conversation was family-related or business-related – or crime-related. I also have difficulty with the notion that I can impute knowledge that the gold was obtained by crime because they talked frequently while the fraud was being perpetrated. How often did they normally talk? There is no evidence on that point.
[42] Since the Crown’s case on actual knowledge rests entirely on circumstantial evidence, a trier of fact may only convict where guilt is the only reasonable inference: R. v. Mezzo, 1986 16 (SCC), [1986] 1 S.C.R. 802.
[43] Is possible that Mr. Marziliano assisted his father and Boghossian in obtaining or disposing of Perth Mint gold with knowledge that the gold bar was obtained by crime. It is, however, equally possible that Mr. Marziliano assisted his father and Boghossian in obtaining or disposing of Perth Mint gold with no knowledge that the gold bar was obtained by crime.
[44] I am thus left in a state of reasonable doubt on the issue of actual knowledge. I now turn to the issue of wilful blindness.
Was Mr. Marziliano wilfully blind?
[45] Mr. Lockner wisely did not press as strongly on the issue of actual knowledge as he did on the issue of wilful blindness. His main submission was that once Mr. Vannicola told Mr. Marziliano that the gold might have been stolen and that he was going to call the police, Mr. Marziliano had a duty to at least make enquiries. He did not, Mr. Lockner concedes, have to go to the police himself, but he was required to do something.
[46] Mr. Lockner is obviously correct on the law, and despite his compelling argument, I must respectfully disagree.
[47] As Charron J. stated in R. v. Briscoe, 2010 SCC 13, [2010] 1 S.C.R. 411 at paras. 21 and 24:
Wilful blindness does not define the mens rea required for particular offences. Rather, it can substitute for actual knowledge whenever knowledge is a component of the mens rea. The doctrine of wilful blindness imputes knowledge to an accused whose suspicion is aroused to the point where he or she sees the need for further inquiries, but deliberately chooses not to make those inquiries…
Professor Don Stuart makes the useful observation that the expression "deliberate ignorance" seems more descriptive than "wilful blindness", as it connotes "an actual process of suppressing a suspicion"…
[48] When Mr. Marziliano attended at Guardian Gold on February 14, 2011 he showed the Perth Mint gold bar to Mr. Baici. Mr. Baici was acquainted with Mr. Marziliano. He understood that Mr. Marziliano had an office in the same building as Guardian, although in cross-examination he agreed that he did not know if the office belonged to Mr. Marziliano or to Ebrekdjian. He just assumed that Mr. Marziliano was in business with his father. He would buy and sell gold for clients. When Mr. Marziliano came to Guardian Gold that day he had a bag. Mr. Baici thought there might have been other gold bars in it but did not see any. He could not say for certain. The gold bar was out of the plastic wrap and had the distinctive kangaroo markings of the Perth Mint.
[49] Mr. Vannicola, Mr. Baici’s boss, had earlier sent an email to his employees warning them not to buy Perth Mint gold bars. Mr. Baici told Mr. Marziliano that it did not suit Guardian to purchase the bar, although he did not tell Mr. Marziliano why.
[50] Mr. Baici testified that he could not recall any particular conversation with Mr. Marziliano. He did not remember exactly what happened next, although he did recall that he tried to get hold of Mr. Vannicola.
[51] Surveillance videos show the following:
• At 10:49 a.m. Mr. Marziliano enters the office of Guardian Gold and walks up to the counter. He put what appears to be his wallet on the counter. He takes what appears to be his cell phone out of his right pocket. He takes something out of his left pocket and either hands it to or shows it to the person behind the security glass. The video is not entirely clear but he does not seem to be carrying a bag.
• At 10:50 a.m. Mr. Marziliano dials a number on his cell phone and begins speaking while still at the counter.
• At 10:51 a.m. Mr. Marziliano dials a number on his cell phone. He exits the office. He is speaking on his cell phone while he exits the office. He walks down the hall.
[52] Mr. Baici testified that he was the person on the surveillance video who dealt with Mr. Marziliano. Contrary to Mr. Baici’s evidence, Mr. Marziliano does not appear to be carrying anything. It appears that he took the gold bar (which is relatively small) from his pocket and handed it to him. It is not entirely clear from the video but that is what seems to have happened.
[53] It does seem that Mr. Marziliano likely did come from an office in the same building as Guardian Gold. He was not wearing a coat on the surveillance video. It was February. It seems unlikely that in February in Toronto Mr. Marziliano came from outside. His father had an office in the same building. I draw the inference that Mr. Marziliano came from that office.
[54] Mr. Vannicola testified that he had received an email regarding Perth Mint gold that had been purchased fraudulently in Montreal. He had received the email either on February 14, 2011 (which he believed was a Monday) or on the Friday prior. He warned his staff.
[55] In chief Mr. Vannicola testified that on February 14, 2011 Mr. Baici called him and said that someone was selling gold from the Perth Mint. He was at the currency office. He walked over to the security glass and spoke to Mr. Marziliano. He told Mr. Marziliano that he was concerned that the gold had been stolen and that he would call the police. He asked Mr. Marziliano if it was his gold. Mr. Marziliano said that it belonged to his client. He then asked if the client was the lawyer Boghossian. Mr. Marziliano then said “yes”. Mr. Vannicola then said that he believed that the gold was the product of a fraud and he would call the police, although he did not at the time believe that Mr. Marziliano knew that. He said that Mr. Marziliano appeared shocked and said that he was unaware that the gold was stolen. Mr. Vannicola accepted that explanation and allowed him to leave.
[56] I do not have any difficulties with the credibility of either Mr. Baici or Mr. Vannicola. I accept that both were trying to assist the Court to the best of their recollections. I do, however, have real difficulties with the reliability of their evidence.
[57] Mr. Baici, for example, testified that Mr. Marziliano was carrying a bag and took the gold bar out of the bag. In fact, on the surveillance tape Mr. Marziliano does not appear to be carrying anything. Mr. Baici testified that the gold bar was out of the packaging. Mr. Vannicola, however, testified that the gold bar was in the original packaging. He said the packaging was distinct because at that time the Perth Mint was one of the few that had gold bars in tamper-proof packaging. He said that he did not see the bar outside the packaging but could observe the gold bar because there was a plastic window in the packaging. I prefer Mr. Baici’s evidence on this point, because it seems clear from the video that Mr. Baici actually handled the gold bar or at least saw it up close. It is not at all clear that Mr. Vannicola did.
[58] The main problem with Mr. Vannicola’s description of the conversation with Mr. Marziliano is that it could not have happened the way he described it. That is because Mr. Vannicola did not speak to Mr. Marziliano during the short visit when Mr. Marziliano presented the gold. Mr. Baici and Mr. Vannicola both testified that Mr. Vannicola was at another office ten minutes away. It is not clear if the ten minutes was by foot or by vehicle, but it scarcely matters. Mr. Marziliano was at Guardian Gold for only two minutes or so. The surveillance tape clearly shows him entering and leaving. It does not show Mr. Vannicola in the hallway. It does not show Mr. Vannicola having a conversation with Mr. Marziliano while he was behind the glass, as Mr. Vannicola described. If the conversation happened in the hallway, that is not captured on the surveillance video. If Mr. Vannicola had a conversation with Mr. Marziliano, it did not happen when he said it did, in the place he said it did, and in the manner he said it did. I am not at all satisfied, for example, that he ever handled the gold bar that Mr. Marziliano presented to Mr. Baici.
[59] Accordingly, I am simply not prepared to accept Mr. Vannicola’s version of events. His errors on key issues mean that I cannot accept that the conversation with Mr. Marziliano happened the way it did. I also cannot accept that it happened at the time and place that Mr. Vannicola says it happened. I therefore cannot be satisfied as to the contents of the conversation. Mr. Vannicola could have had no actual knowledge of Boghossian’s involvement at that moment. It was based on a hunch – or possibly based on after-acquired information. Either way, I cannot be satisfied that he told Mr. Marziliano that the gold was likely stolen or obtained fraudulently.
[60] The result is that I cannot accept the Crown’s theory that Mr. Vannicola’s discussion with Mr. Marziliano gave rise to a duty to make inquiries. I must say that the evidence is perilously close to the line, given all the circumstances, but ultimately I am left in a state of reasonable doubt on the issue of wilful blindness.
DISPOSITION
[61] The charge is dismissed.
R.F. Goldstein J.
Released: December 6, 2016
CITATION: R. v. Marziliano, 2016 ONSC 7608
COURT FILE NO.: CR-15-70000088-0000
DATE: 20161206
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
HER MAJESTY THE QUEEN
– and –
GARNET MARZILIANO
REASONS FOR JUDGMENT
R.F. Goldstein J.