by BETTER FARMING STAFF
For years, he flew high on a pigeon breeding business that he claimed changed farmers’ lives for the better and brought millions into his company. On Wednesday, Waterloo Regional Police and the RCMP brought Arlan Galbraith to earth with one charge of fraud over $5,000 and four counts under the Bankruptcy Act.
The charges follow a lengthy, two-year investigation by both police agencies of the former, self-anointed pigeon king and his Waterloo-based business, Pigeon King International.
The fraud charge relates to allegations that Galbraith, 62, defrauded individuals in Canada and the United States of more than $1 million between 2004 and the company’s collapse in June, 2008. The charges have not been proven in court.
The PKI breeding scheme offered pigeon breeding pairs for as much as $500 and bought back offspring for up to $50 each. Police estimate about 1,000 people invested a total of $20 million in the scheme. The two authorities began their joint investigation shortly after the PKI bankruptcy, acting on allegations the operation was a Ponzi scheme.
Ponzi schemes depend on a continuing flow of money from new participants to pay off earlier investors. Such schemes are illegal under the Criminal Code, according to a January 2009 report from the Office of Superintendent of Bankruptcy.
Staff Sgt. Dale Roe, with the Waterloo Regional Police Service’s fraud squad, says the decision was made to proceed with one count of fraud because of the number of investors involved. “Not all of those people (investors) were victims but quite a proportion of them were,” he says.
Galbraith turned himself in at the service’s detachment in Kitchener. He was held for a bail hearing that took place yesterday and was subsequently released, Roe says. His next court date is Jan. 25, 2011.
Roe does not know how Galbraith, a resident of Cochrane, Ontario, got to the station.
Earlier this year, Galbraith skipped his personal bankruptcy creditors’ meeting that was held in Kitchener, claiming that it was too expensive to attend.
By 2007, Galbraith had recruited hundreds of breeders in the United States and Canada and claimed that he was multiplying the birds that would eventually be used for meat processing and he was planning on building a squab processing plant.
But others, including former PKI employees as well as experts in pigeon racing and squab production challenged Galbraith’s claims noting the birds were not suitable for racing, showing or meat production. By May 2008 four U.S. states took steps to prevent the company from operating within their boundaries, including regulatory actions.
Unable to meet his financial commitments, Galbraith handed the business to a bankruptcy trustee in June 2008.
Creditors forced Galbraith into personal bankruptcy in 2009.
Police say in a news release issued this morning that no further charges are expected.
For more on this story, read the January 2011 issue of Better Farming. BF