COURT FILE NO.: CRIM MOT(P) 106/22
2022 10 13
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Travelers Insurance Company of Canada v. His Majesty the King
BEFORE: Fowler Byrne J.
COUNSEL: David Ullman and Alex Fernete Brouchu for the Applicant
Mitchell A. Flagg, for the Respondent
HEARD: July 27, 2022
E N D O R S E M E N T
[1] The Applicant Travelers Insurance Company of Canada (“Travelers”) seeks relief from forfeiture pursuant to s.462.42(1) of the Criminal Code, R.S.C., 1985, c. C-46. In particular, Travelers seeks payment from certain forfeited funds being held by the Crown in relation to the proceeds of criminal activity of Mr. Sebastien Vachon-Desjardins.
I. Background
[2] On or about January 31, 2022, Mr. Vachon-Desjardins pleaded guilty to five counts of a series of offences involving mischief, theft of computer data, extortion, the payment of cryptocurrency ransoms, and participating in the activities of a criminal organization. These offences involved 17 Canadian victims who suffered losses in the millions of dollars. He is also facing similar charges in the United States of America, where worldwide losses are estimated at $40 million USD.
[3] One year prior, in January 2021, in the course of its investigation in Canada, the RCMP were able to seize just under 720 Bitcoins from Mr. Vachon-Desjardins’ e-wallets and accounts, and close to $1 million in cash. The value of Bitcoin is volatile. At the time the Bitcoin was seized, its estimated value was approximately $34 million. When Mr. Vachon-Desjardins was sentenced one year later, the Bitcoin was valued at approximately $23 million. I have no evidence as to its value on the date of this hearing.
[4] Travelers was the cyber-insurer for two clients who fell victim to Mr. Vachon-Desjardins: Robert Thibert Inc. (“Thibert”) and Technologies Xpertdoc Inc. (“Xpertdoc”). Both made claims to Travelers for their losses and sizable claims were paid out. For Thibert, Traveler paid out more than $1 million. For Xpertdoc, Travelers paid out the sum of $260,550. In addition, each client paid $10,000 as a deductible and would like to be reimbursed this amount if possible.
[5] In or about December 2021, Investigative Sergeant Pascal Lussier of the Sûreté du Quebec (“SQ”) contacted various victims to advise that the RCMP had apprehended an individual linked to the ransomware attacks. Two of these victims were Thibert and Xpertdoc. Sergeant Lussier advised that the RCMP wanted to receive an assessment of the costs incurred by these parties because of the attacks. This request was forwarded to the claims adjuster for these parties, Mr. Luc-André Girard.
[6] The parties agree that correspondence was sent with respect to the losses paid to Thibert as of that date, which had been assigned to their insurer, Travelers. Mr. Girard indicated that Travelers would probably be making further payments on behalf of that claim.
[7] With respect to Xpertdoc, on December 21, 2021, Mr. Girard advised that Xpertdoc had suffered losses of $255,800 to date. Of that sum, $245,800 had been paid by its insurer Travelers and the remaining $10,000 was the deductive paid by Xpertdoc. Mr. Girard also stated that it was anticipated that Travelers would have to pay an additional sum of $12,500. Sergeant Lussier was advised that Travelers was assigned this debt and that it was requesting reimbursement for this amount plus the deductible paid by its client.
[8] On January 31, 2022, Justice G. P. Renwick of the Ontario Court of Justice presided over a guilty plea and a sentencing hearing for Mr. Vachon-Desjardins. On that day, he accepted the joint submissions of the Crown and the defence and sentenced Mr. Vachon-Desjardins to 7 years’ imprisonment, forfeiture of assets seized, restitution, and a DNA Order. The exact items to be forfeited to the Crown under s.462.37(2.01) of the Criminal Code were 680.49591411 Bitcoins, 15.725489349111 Monero (XMR), and cash of approximately $742,000.
[9] This sentence was based on a lengthy Agreed Statement of Facts. With respect to Thibert, it stated:
Thibert reported the following financial loss because of this ransomware attack: $1,062,045, including a ransom payment of $427,449 CAD, consultation fees of $280,000 and loss of profit of $340,000. Insurance reimbursed $1,000,000. However, there is still money outstanding.
On January 26, 2021, the company paid 10.15929948 BTC ($412,425 CAD) to the address 3ChmcNu6nJKqi9RK1owNTkC9jRy5RGyEvv, which is a NetWalker cryptocurrency wallet. The payment was traced by investigators to later end up in Mr. Vachon Desjardins’ Cluster 1 cryptocurrency wallet address of 3PBXRRYAyyvrbweS7rQpJhuZwiWiEGhYXH.
[10] With respect to Xpertdox, it stated:
The impacts of this attack on Xpertdoc’s operations and customers were substantial. The company reported the following financial loss as a result of this ransomware attack: a total of $258,300 in fees including $5,000 USD in cyber security consulting services, $37,210.47 USD in ransom payment, $55,949 CAD in Mandiant investigation and $11,518 in lawyer fees. Insurance did cover $255,800.
On September 24, 2020, XpertDoc sent 3.53065110 BTC to the address 35uzCeqxHA629csXKJgR54j792Zp9sjzQM, which is a NetWalker cryptocurrency wallet. Investigators conducted a trace of the payment and noted it had ultimately been sent to Mr. Vachon Desjardins’ Cluster 1 cryptocurrency wallet address 3ASx1PpA7r1p9swNHXhUCmheRVkx34RWnH after being processed through mixing services and a portion of the payment sent to NetWalker.
[11] Justice Renwick delivered his written Reasons for Sentence the next day on February 1, 2022 (see 2022 ONCJ 43). With respect to the restitution portion of the sentencing, seven of the seventeen Canadian victims were specifically granted restitution as part of the sentencing. Travelers received the sum of $706,921 on behalf of the Thibert claim. This amount has been paid from the forfeited funds.
[12] A footnote to the Reasons for Sentence of Justice Renwick states:
[At least $2.8 million in direct losses] is a gross underestimate, but it is the total value of monies for which restitution is claimed by 7 of the Defendant’s 17 Canadian victims. Several victims were reimbursed for losses by insurance carriers or they have not responded to requests for information about potential restitution claims: Xpertdoc, for example, reported a total loss of $258,300, but because it was re-imbursed by their insurance for $255,800 (a loss which is not included in the $2.8 million estimate), no claim for restitution was sought.
[13] For the purposes of this application, the parties agreed that it is not known why the claim of Xpertdoc was not put before Justice Renwick or why he believed Xpertdoc was not seeking restitution.
[14] Shortly thereafter, on May 10, 2022, the Crown received a letter from the U.S. Department of Justice who expressed interest in the forfeited assets pursuant to the Order of Justice Renwick. It advised that there were over 400 victims worldwide of this ransomware criminal enterprise. An indictment against Mr. Vachon-Desjardins was issued in Florida on December 2, 2020. The United States was confident that it would receive a restitution order. It wished to have access to the forfeited funds, after the amounts under the Order of Justice Renwick were paid, to provide restitution to the victims it had identified.
[15] This application was commenced by Traveler for two reasons. First, the amount ordered to be paid to Travelers, on behalf of Thibert, did not represent the entire amount paid out under its policy. Additional funds were paid out after the sentencing order, which it would now like to be paid from the forfeited funds. Second, it is seeking the amount claimed on behalf of Xpertdoc, which was omitted entirely from the sentencing order.
II. Late Delivered Submissions
[16] Following the submissions in this matter, which included the issue of the legal costs expended by the Applicant, counsel for the Crown emailed the court, making further brief submissions on the issue and submitting further case law for my consideration. The Applicant requested that these cases not be considered as they were provided after argument.
[17] I agree with the Applicant. The issue of whether the Applicant could seek relief from forfeiture with respect to its legal fees has already come before the court. It would be inappropriate to consider further argument after submissions ended.
III. Issues to be Determined
[18] The parties agree that Travelers’ two insureds were victims of these crimes, and that the insureds assigned their rights in these funds to Travelers. It also appears that the Crown is holding, as restitution, more than what Travelers is seeking. In essence, the parties disagree about Travelers’ entitlement under the relief from forfeiture provisions of the Criminal Code, and, if it is entitled, the amount to which it is entitled.
[19] The following issues are to be determined:
a) Is Travelers entitled to further restitution?
b) Is Travelers entitled to relief from forfeiture?
c) If so, what sum is Travelers entitled to?
IV. Position of the Parties
A. Position of Travelers
[20] Travelers is seeking relief from forfeiture for the sum of $542,389. This comprises the sum of $271,839 for Thibert, which represents additional funds paid out under the claim and includes the $10,000 deductible paid by the client. The remaining sum of $270,550 is for the Xpertdoc claim, representing the entirety of the claim paid out, which also includes the $10,000 deductible paid by the client.
[21] Travelers makes several arguments to support its position. First, it was not given notice of the sentencing hearing, which would have at least given it the opportunity to correct the position of Xpertdoc at that time.
[22] Second, Travelers has an interest in the property, as required in s.462.42(1) of the Criminal Code. This interest arose when there was the opportunity to be considered for restitution in this matter and due to defects in the process that was taken, it was not received. Travelers states that by making his sentencing order as he did, Justice Renwick declared that the parties entitled to restitution had an interest in the property which is forfeited to the extent of their entitlement for restitution.
[23] Third, Travelers argues that it is not a creditor, as the accused does not owe it money. It is, instead, a party that ended up being owed restitution because of an illegal act. This, it alleges, puts it above the general creditor threshold, giving it an interest in the property. Therefore, it should take priority over the forfeiture order.
[24] Finally, Travelers argues that I have discretion to make this order. Just as I have discretion to not grant relief from forfeiture, Travelers argues that the Criminal Code also provides the court the discretion to make the appropriate order in accordance with its discretion. It argues that I can declare that, in these circumstances, there is an interest in the property. Travelers argues that the court exists to solve problems like this with its discretion. When there is a clear error in a judicial process, as it argues occurred here, I can correct the error in this manner.
B. Position of the Crown
[25] The Crown has taken the position that Travelers’ interest in the forfeited property is limited to the amount of Bitcoin that both Thibert and Xpertdoc paid to Mr. Vachon-Desjardins as ransom. With respect to the Thibert claim, that amount was already the subject of the restitution order which was part of the sentence of Mr. Vachon-Desjardins. With respect to the Xpertdoc claim, it is limited to 3.53065110 Bitcoins.
[26] In its materials, the Crown requested that this interest in the forfeited property be reduced by 20%, as this was the amount that Mr. Vachon-Desjardins paid or “kicked back” to a third party who developed the software he utilized. The Crown advised at the hearing of this application that it was willing to forego the request of a 20% reduction and agreed to recognize the full ransom that was paid.
[27] The Crown submits that this court has neither authority nor jurisdiction to grant relief from forfeiture for any further amount within the criminal proceeding, other than the reimbursement of Xpertdoc’s ransom payment. If Travelers wishes to pursue the remainder of the monies it is out of pocket, it must do so in civil court.
V. Analysis
A. Is Travelers Entitled to Further Restitution?
[28] The sentencing of Mr. Vachon-Desjardins is now complete. Despite that, Travelers seeks standing to bring this application as a “person” under s.738(1)(a) of the Criminal Code. This section of the Criminal Code addresses who may seek restitution at the time of sentencing when they suffered a loss of property because of the offender’s criminal activity.
[29] I accept that at the sentencing stage of a criminal proceedings, Travelers was entitled to seek restitution as the insured for both Thibert and Xpertdoc. This was well established in R v. Popert, 2010 ONCA 89 at paras. 32-35, where the court explains that s.738(1)(a) is not restricted to those whose property was damaged but can include other parties who suffered losses as a result of loss or destruction of “any person,” recognizing the role of insurance.
[30] The right to restitution at a sentencing hearing, however, does not give Travelers the right to appear at the sentencing hearing and make submissions. The right of victims to participate in the sentencing, with respect to restitution, is addressed through the Crown.
[31] I acknowledge that Travelers was notified of the potential of restitution for both Xpertdoc and Thibert through the SQ. The evidence on this application was unclear about whether this was notice as contemplated by the Criminal Code. Justice Renwick found it appropriate though, to make the restitution order based on the evidence provided to him.
[32] Even if proper notice was not given, the Crown argues that this was remedied by the process set out in s.462.42, wherein those who did not have an opportunity to prove their interest in the forfeited property at the sentencing could do so within 30 days thereafter, which was done here. Again, the court must consider the same test: whether the applicant has an interest in the property.
[33] The right to seek restitution exists only at the sentencing stage of the proceeding. Popert, which recognized the right of insurers to seek restitution, was an appeal of a sentence. In our case, sentencing is over. Even if I accept that Travelers is a person entitled to seek restitution, I have no authority to revisit any further restitution under the guise of sentencing. Neither the Crown nor Mr. Vachon-Desjardins has appealed this sentence. I have received no case law supporting the proposition that I can revisit a sentence that has not been appealed and change its terms even if the terms of that sentence were made in error.
[34] It is clear that some of the parties who were granted restitution by Justice Renwick received more than just their interest in the forfeited property. Using the principles of restitution, Travelers received funds sufficient to repay the ransom it paid on behalf of Thibert, which formed part of the seized property, and was also reimbursed for consultation fees it paid out, and other items for which it provided coverage under its policy. It is a principle of restitution that the court should attempt to make the victim whole and can consider the ability of the offender to pay when making its order. Perhaps it was because at that time, there was more than enough money to pay it out. This restitution order was made prior the Crown being notified by the U.S. Department of Justice of the other victims throughout the world, and the Department of Justice’s hope to share in the remaining forfeited property for the benefit of all the victims.
[35] I imagine it frustrates Travelers that, had its claim on behalf of Xpertdoc been properly represented to Justice Renwick, it would have benefited from a generous restitution order as well. Unfortunately, that did not occur and the process cannot be revisited. The sentence was not appealed. The demand on the remaining forfeited funds now far exceeds what is being held. Mr. Vachon-Desjardins cannot make all his victims whole. The only possible recourse available to Travelers is an application for relief from forfeiture under s.462.42 of the Criminal Code. This is not restitution, which is a principle of sentencing. Travelers’ standing to bring this application for relief against forfeiture is not disputed. What is disputed is whether it should succeed and, if so, to what extent.
B. Relief from Forfeiture
[36] A person who claims to have an interest in property that has been forfeited under s.462.37 may, within 30 days of the forfeiture order, apply for an order under 462.42. Travelers made this application within the appropriate timelines.
[37] The purpose of the forfeiture scheme in the Criminal Code is to prevent criminals from profiting from their crimes. This purpose would be defeated if the ordinary debts of the criminal could be discharged from the forfeited property. Accordingly, anyone claiming relief from forfeiture must establish that a claim goes beyond that of an ordinary unsecured creditor of the offender, but rather constitutes an interest that attaches to the property itself. These provisions did not intend to harm innocent third parties who may have a legitimate interest in that same property that has been forfeited. That is the purpose of the provisions permitting relief from forfeiture and that purpose must be kept in mind when considering whether a particular applicant is entitled to the relief sought: 1431633 Ontario Inc. v. Her Majesty the Queen, 2010 ONSC 266, at paras. 24, 30; R. v. Fercan Developments Inc., 2016 ONCA 269 at para 81; R. v. Fletcher, 2015 ONSC 8069 at para. 45, adopting Canada (Attorney General) v. Lumen Inc., 1997 10717 (Que. C.A.), leave to appeal to SCC refused, Dec 11, 1997 (SCC Court File No. 26187).
[38] Although the forfeiture provisions are part of the Criminal Code, they deal with the property rights of innocent third parties and typically involve determinations as to priority claims by secured creditors: 1431633 Ontario Inc. at para. 22.
[39] To successfully seek relief for forfeiture, Travelers must show:
a) It has not been charged with one of the enumerated crimes;
b) It did not acquire an interest in the forfeited property in circumstances which give rise to the reasonable inference that the person transferring the property did so for the purpose of avoiding the forfeiture of the property;
c) It is innocent of any complicity in the enterprise crime that resulted in the forfeiture; and
d) It is innocent of any collusion in relation to any such offence.
R. v. Wilson, (1993) 8665 (ON CA), 15 O.R. (3d) 645 (Ont. C.A.) at paras. 29-31.
[40] It is conceded that these criteria would not disqualify Travelers.
[41] In addition, Travelers bears the onus that, on the balance of probabilities:
a) It has a valid interest in the property that goes beyond the interest of a general creditor and that the nature and extent of that claim has been proven; and
b) It would be appropriate in the circumstances for Travelers’ interest to take priority over the forfeiture order.
1431633 Ontario Inc. at para. 26.
[42] These last two tests are at issue before me. Even if all the prongs of the test are met, it remains within my discretion to decline ordering any such relief. When exercising my discretion, I must decide whether Travelers should suffer so that the goal of divesting the offender of his or her ill-gotten gains can be achieved, or whether that goal should be tempered to permit vindication of Travelers’ legitimate interest in the forfeited property: Wilson at paras. 31-33; 1431633 Ontario Inc. at para. 25.
- Interest in Property: Ransom Payments
[43] The Crown concedes that Travelers has an interest in the forfeited property up to the amount of Bitcoin paid as ransom. For Thibert, that is 10.15929948 Bitcoins, which, on January 26, 2021 (the date the Bitcoin was seized), was worth $412,425 CAD. For Xpertdoc, that is 3.53065110 Bitcoins, which was agreed to be worth $37,210.47 USD on the day it was paid.
[44] Travelers has already received that much through the restitution order of Justice Renwick with respect to Thibert. The Agreed Facts that were provided to Justice Renwick specified that the funds paid out included the ransom payment. Accordingly, there is no further interest in the property with respect to the ransom payment.
[45] The amount of ransom paid on behalf of Xpertdoc was not ordered to be paid as restitution on that day. Accordingly, the amount the Crown concedes that Travelers has an interest in, on behalf of Xpertdoc, is 3.53065110 Bitcoins.
- Interest in Property: Remaining Insurance Payments
[46] Traveler’s cyber insurance covered more than just the amount paid in ransom. It also paid out, to its insured, additional sums such as money for crisis consultation fees, extortion fees, operating losses, and remediation fees. Travelers has also incurred its own legal fees in seeking restitution at sentencing and relief from forfeiture in these proceedings.
[47] Travelers argues that these other fees, plus the deductible paid by its clients, should also constitute an interest in the forfeited property.
[48] I disagree. The Applicant characterizes its “interest” as being what it would have received had it had its claim been properly before Justice Renwick. This is incorrect in two ways.
[49] First, some of the amounts sought were for sums paid out by Travelers after the sentencing hearing. Even if the Crown had put everything it had before Justice Renwick, he could not order restitution for sums that were not yet determined. Justice Renwick was clear in his reasons about ordering restitution only for the sums that were already set out. This restitution did not include amounts yet to be determined.
[50] This is made even clearer with respect to Thibert. In the agreed Statement of Facts, it is acknowledged that there was more money outstanding. The Statement acknowledged that Travelers paid out $1,000,000 but Justice Renwick only ordered restitution of approximately $706,000. Had Justice Renwick or the parties contemplated more money to be paid as restitution or that more evidence was forthcoming with respect to the losses, they had the option of adjourning the sentencing proceedings until which time that sum could be crystallized. They chose not to do so.
[51] With respect to the non-ransom items that were known at the time of the sentencing, but for which no restitution was paid, I do not find that those items constitute an “interest in property” as contemplated by s.462.42.
[52] Ordinary creditors do not, as a rule, have an enforceable interest in any particular asset of their debtors. They enjoy no right or recourse in relation to an asset and cannot enforce payment of an unsecured debt either by seizure of or out of the proceeds of its disposition. An ordinary creditor may acquire, as a result of successful court proceedings, a “valid interest” in specific assets of a debtor, but that is a consequence of the proceeding and not a pre-condition to the exercise of that recourse: Lumen Inc. at paras. 22-23.
[53] Parties who have successfully claimed an interest in forfeited property include a bank who held a valid security agreement with respect to a vehicle that had been seized (R v. Canadian Imperial Bank of Commerce, 2000 16957 (ON CA), [2000] O.J. No. 4149 (QL)); a lumber supply company who held a valid construction lien on a home that was seized (1431633 Ontario Inc.); a second mortgagee who had an interest in a home that was seized (R. v. Nguyen, 2013 BCSC 80). In R v. Tatarchuk, 1992 6161 (AB KB), [1992] A.J. No. 738 (QL), the court ordered that the Bank of Montreal was entitled to relief from forfeiture with respect to a sum owed by the accused due to a fraud perpetrated against it. While the court declined to opine on whether an ordinary creditor may seek relief from forfeiture, it did find that the Bank of Montreal became a secured creditor by virtue of serving a Notice of Garnishment on the holder of the forfeited funds, prior to those funds being forfeited to the Crown, by virtue of the Execution Creditors Act, R.S.A. 1980, c.E-14 (which has since been repealed), and the Alberta civil rules of court.
[54] In Morvai v. Canada (Attorney General), 2010 ONSC 279, the court found an interest in property equivalent to the value of manual labour put into a home by an innocent third party who failed to file a lien. The court so found based on the principles of unjust enrichment, whereby the Crown was enriched by the labour of the applicant, who was correspondingly deprived. The court found no juristic reason for this enrichment.
[55] I have been provided with no authority supporting the proposition that a claim for these sorts of losses, that should have been addressed in sentencing, and was admittedly and erroneously omitted, becomes an interest in forfeited property. This is because the nature of the non-ransom claims had nothing to do with the seized property. The property seized was the proceeds of ransom demands made to many victims. Travelers has been already granted restitution with respect to the ransom paid for Thibert, and I am ordering that it have an interest in the ransom paid on behalf of Xpertdoc. The funds paid out by Travelers under their cyber insurance policy, for loss of profits, consultation fees and legal fees though, are monies for which Travelers may pursue Mr. Vachon-Desjardins, but in no way impress an interest on the remaining ransoms being held by the Crown. Mr. Vachon-Desjardins did not demand that Thibert or Xpertdoc pay to him other monies to cover any future loss of profits or legal fees. That is not money that Mr. Vachon-Desjardins ever had. A mortgagee or other secured party can claim their interest and legal fees because that is part of the mortgage agreement or loan agreement that is secured. A construction lien claimant can seek its legal fees as it is considered part of its lien as provided for under the Construction Act, R.S.O. 1990, c.C.30. There is no claim for unjust enrichment here because the Crown has not been enriched by the amounts paid out by Travelers for lost profits, consultation fees or legal fees.
[56] The Applicant relies on R. v. Dennis, 2003 BCSC 2017 in support of the proposition that restitution could include not only the amount the victim was out of pocket, but their legal fees as well. This case is distinguishable in that it was a sentencing decision. The issue of restitution was alive and no “interest in property” had to be determined. In this case, the principles of restitution are of no assistance.
- Interest in Property: Exercise of my Discretion
[57] Section 462.42(4) indicates that, in the event I find that the Applicant is not a person who is prohibited from applying for relief from forfeiture, it is still within my discretion to decline the request and not grant relief from forfeiture. Travelers argues that, conversely, even if I do not find an interest in property, I can exercise my discretion and allow relief from forfeiture in appropriate circumstances.
[58] The Applicant relies on R v. Fitzgibbon, 1990 102 (SCC), [1990] 1 SCR 1005. In this case, the Applicant was the Law Society who had paid out claims from its Compensation Fund to clients who had their funds misappropriated by a lawyer, Mr. Fitzgibbon. At his sentencing, Mr. Fitzgibbon was ordered to reimburse the Law Society and pay to a particular client the amount by which his losses exceeded the amount he received from the Compensation Fund.
[59] At the appeal of his sentence, Mr. Fitzgibbon argued that he is entitled to defend the civil proceedings brought by the defrauded client before a restitution order is made for this amount. The Supreme Court of Canada disagreed and found that, in the circumstances when the amount of loss is confirmed, and the criminal conduct is admitted, the victim should not have to incur the additional expense of proving their claim in civil court.
[60] I agree and am bound by this ruling, but again, it is within the context of a sentencing appeal. A certain amount of restitution was ordered as part of sentencing and the offender appealed it. In the case before me, neither the Crown nor Mr. Vachon-Desjardins have appealed the sentence.
[61] Exercising my discretion to grant relief from forfeiture when no interest in property has been found would be inappropriate. Before I am even permitted to consider any relief from forfeiture, I am required to ensure that the applicant is not a party described in s.462.42(1), namely the party charged with the offence, or someone who had possession of the property because it was transferred to them to avoid forfeiture. It is a necessary inference from the language used in s.462.42(1) that the claimant must have an interest in the property. Otherwise, Mr. Vachon-Desjardins will benefit from his crime in that he will have already satisfied an anticipated civil judgment in favour of Travelers. Travelers should not be given a priority in these circumstances. That is not the intention of the forfeiture scheme in the Criminal Code: 1431633 Ontario Inc., at para. 24, relying on Lumen Inc.
[62] Accordingly, I do not infer from s.462.42(4) that I have the discretion to grant relief from forfeiture when no interest in the forfeited property can be shown.
VI. Conclusion
[63] For the foregoing reasons, I find that Travelers Insurance Company of Canada is not a person referred to in subsection 462.42(1)(a) or (b) of the Criminal Code and appears innocent of any complicity in any designated offence that resulted in the forfeiture or of any collusion in relation to any such offence. I further find that Travelers Insurance Company of Canada has established a valid interest in part of the Property that was ordered forfeited, restricted solely to the amount paid in ransom, if not already paid.
[64] Accordingly,
a) In complete satisfaction of this application under ss. 462.41(1) and 462.42(4) of the Criminal Code, the interest of the Applicant is not affected by the Forfeiture Order and this court declares the nature and extent of the interest to be 3.53065110 Bitcoins, less any fees inherently associated with effecting the transfer; and
b) The remainder of the Application is dismissed.
Fowler Byrne J.
DATE: October 13, 2022
COURT FILE NO.: CRIM MOT(P) 106/22
DATE: 2022 10 13
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Travelers Insurance Company of Canada v. His Majesty the King
COUNSEL: David Ullman and Alex Fernete Brouchu, for the Applicant
Mitchell A. Flagg, for the Respondent
ENDORSEMENT
Fowler Byrne J.
DATE: October 13, 2022