Toronto, December 11 (CINEWS): Two Canadians have been arrested following an investigation into a pyramid scheme that allegedly took in more than US$93 million ($126 million CAD). Christopher George Smith, of Toronto and Rajiv Dixit of Vancouver (both 45 years of age) appeared in a Toronto court on Wednesday after their arrest. They have been charged with fraud, possession of the proceeds of crime and laundering the proceeds of crime,
operating a pyramid scheme and making false representations under Canada’s Competition Act.
According to Toronto Police the scheme operated between October 2010 and March 2013, out of an address on Church Street.
Known as “Banners Broker,” participants were offered an opportunity to double their money by investing in an online advertising company which would post banner ads on websites around the world. As visitors clicked on these banners and were directed to other client sites, the advertising company would get paid and then pay its investors. However police explained that the investors were misinformed and only made money off contributions from others who had invested in the company as they had.
Det. Sgt. Ian Nichol said in a press conference held on Wednesday that thousands of people invested in the scam over the three-year span. Some lost a few hundreds, others were defrauded of several thousands. Approximately US$45 million was paid back to participants, but the remaining funds were transferred into offshore accounts in Belize, St. Lucia, Cyprus and other countries. The Banners Broker website was finally shut down in August 2014.
The men face five charges each, including possession of the proceeds of crime and defrauding the public over $5,000.