Jury finds Pigeon King founder guilty of criminal fraud
Published Thursday, December 5, 2013 11:31AM EST
Last Updated Thursday, December 5, 2013 6:42PM EST
Arlan Galbraith, the founder of Pigeon King International, has been found guilty of criminal fraud and two Bankruptcy Act offences.
Jurors announced their decision late Thursday morning, following more than two full days of deliberations.
“It took a long time, but I think that’s because the jury had so many documents that they had to go through,” Crown prosecutor Lynn Robinson tells CTV News.
“Because of this jury’s bravery today, we will be seeing Mr. Galbraith punished.”
As the verdicts were read, Galbraith – who represented himself – stood in the courtroom and showed little emotion.
He asked for time to get his affairs in order, but Justice Gerry Taylor denied that request and ordered Galbraith be kept in custody until a hearing on his bail status next week.
Taylor also “strongly advised” that Galbraith hire a lawyer for the next stages of his case.
The trial began just over one month ago, and more than five years after Pigeon King entered into bankruptcy.
Robinson had contended that the company was a “deceitful, fraudulent scam” that could only be sustained as long as new investors were found to buy pigeons from existing investors.
When the company went bankrupt in June 2008, it had paid 394 pigeon breeders about $30 million and had committed to pay a further $350 million.
Thousands of pigeons were sold at low prices, given away or killed by breeders who found themselves out thousands of dollars.
“The people that got in early made money, so they weren’t concerned. It was only when things started to go sideways that concerns really hit,” says Robinson.
A forensic accountant testified at the trial that the company would only be able to meet those commitments by finding more breeders for the birds – which would then put it on the hook for a further $3 billion.
Galbraith denied those assertions, saying he hoped to sell the birds to hobbyists or to be used as meat, and suggested repeatedly that Pigeon King’s financial woes were the result of plans to destroy the company by “enemies” including the Amish mafia.
In addition to fraud, Galbraith was convicted of two Bankruptcy Act offences – obtaining money by false representation and failure to attend first meeting of creditors.
The Crown is expected to seek a nine-year prison sentence for Galbraith.