Pigeon King would have owed $3 billion eventually, accountant testifies
Published Wednesday, November 27, 2013 6:14PM EST
Last Updated Wednesday, November 27, 2013 6:36PM EST
An RCMP forensic accountant took the stand Wednesday at the fraud trial of former Pigeon King boss Arlan Galbraith.
Jeff Good was brought in by police to pour through the company’s books after it declared bankruptcy in the summer of 2008.
He testified that at the time of the company’s bankruptcy, they had paid 894 pigeon breeders about $30 million and had committed to a further $350 million.
But in order to pay those further commitments, Good said, the company would have to recruit more breeders to buy those birds – and would then owe that next wave of breeders nearly $3 billion.
Good was brought in after the company’s bankruptcy to pour through Pigeon King’s books.
At the time of the bankruptcy, Good testified, Pigeon King was committed to paying more than $2.6 million to breeders each month – a figure which was growing by about $100,000 per month.
“If they had gone the full 10 years of the contract, the farmers would have made good money,” he said in court.
Galbraith, who is representing himself in the trial, asked Good in cross-examination if it was possible to say whether Pigeon King would have grown or failed as a company had it survived.
“At the time of your bankruptcy, there was no money left in your bank account and you owed $350 million,” Good replied.
Prosecutors allege Pigeon King was an elaborate Ponzi scheme which could only sustain itself as long as new investors were brought into the fold to pay existing breeders.
Galbraith, who has pleaded not guilty to criminal fraud and four Bankruptcy Act offences, has previously suggested the Amish mafia attempted to destroy his company from the inside.
The trial resumes Thursday.