A Toronto pastor conducted an investment fraud that took more than $8-million from colleagues and parishioners – including a stay-at-home mother with two blind children, the Ontario Securities Commission has concluded.
Marlon Hibbert, pastor and founder of Dominion World Outreach Ministries in Toronto, lied to investors about using their money in a foreign-exchange trading strategy and falsified monthly statements to make it look like they were earning a profit, according to a ruling Thursday by OSC commissioner James Carnwath.
"By virtue of Hibbert's deceptions and untruths, many investors lost their entire investment," the ruling concludes. "To date they are owed more than $8.2-million in principal, to say nothing of the promised returns of more than $13-million."
The OSC has not scheduled a hearing yet to decide on a penalty in the case, but the regulator has the power to impose fines and prohibit people from working in securities-related jobs.
Mr. Hibbert was prominent in Toronto's black community and many of his victims met him through those connections. He was a founder of the Fight for Justice organization, which advocates on behalf of the African-Canadian community in the city.
The OSC ruling said a forensic accountant concluded Mr. Hibbert raised $8.4-million from investors and took $673,000 for himself, using some of the money to make donations to charities and some to pay credit card bills, school fees, hotels and gym memberships.
Mr. Hibbert lied to victims by telling them he was using their funds in a successful foreign-exchange scheme, but there was no evidence he ever made a profit on any investments he made. Investors believed their funds were safe and earning returns when instead Mr. Hibbert was racking up large losses.
"He lied to investors when he tried to explain why the payments of principal could not be made and provided a litany of excuses, which were untrue, as to why repayments of principal were not possible," the ruling said.
The decision said one victim who testified at the OSC hearing in the case was a stay-at-home mother with a son who is both blind and autistic and a second son who is blind. She said she and her husband invested $60,000 with Mr. Hibbert in 2006 and 2007 that they had received from her mother-in-law's estate.
When she asked for half of the investment to be paid out in 2009, she met with a series of delays and explanations about why the funds could not be paid. Eventually she learned Mr. Hibbert was under investigation and the money would not be returned.
At the hearing, the unidentified woman was asked about the impact on her family and replied, "This is where I cry."
"She described her desire to establish security for her oldest son who would probably never work," the ruling says. "[She]said she wanted to put an end to Hibbert living off other people's money."
Another victim, a part-time teacher, said the impact of her investment losses was "pretty devastating" and she and her husband had to sell their house and move their three children into a small rental unit.
The OSC said Mr. Hibbert conducted the fraud through a company called Power to Create Wealth Inc., whose name later changed to Ashanti Corporate Services Inc.