Friday, March 12, 2010

Priest pleads guilty to $2.7M real estate scheme

A northern Indiana man pleaded guilty Wednesday in federal court to a scheme defrauding real estate developers and churches of more than $2.7 million while presenting himself as a priest, court documents said.

Byron “Father Barney” Canada pleaded guilty in U.S. District Court in South Bend to 31 counts including wire fraud, money laundering and criminal conspiracy, court documents said.

Canada ran two lending corporations based in South Bend, and through them bilked borrowers between 2004 and 2009, according to charging documents.

Canada collected upfront fees from borrowers including various businesses, real estate developers and commercial developers, as well as churches seeking to pay for building projects, court documents said.

Canada collected and kept the fees, which ranged from $5,000 to $250,000, as advanced payments for loans that his companies were incapable of financing.

He received checks and wire transfers from victims across the country, court documents said.

The South Bend Tribune reported that at Wednesday’ hearing, the prosecuting attorney asked judges to extend the sentencing date because Canada is cooperating with investigators as they build a case against his accomplices.

Canada is free on bond until his Sept. 27 sentencing, U.S. attorney’ office spokeswoman Mary Hatton said Thursday.

According to charging documents, Canada dressed in clerical garb when meeting victims to give the scheme “an aura of legitimacy and honesty.”

Canada is an ordained Orthodox-Catholic priest, Hatton said. But is unclear whether he is currently affiliated with a church, she said.

The Rev. Robert Zahrt of Fort Wayne, metropolitan archbishop of the Orthodox-Catholic Church of America, told The South Bend Tribune that Canada had been affiliated with his church but left it last year.

Zahrt said Canada then joined an offshoot of the Roman Catholic Church, the Columbus, Ohio-based Reformed Catholic Church, but that church had disbanded, but seems to have recently been revived.

A message to Zahrt seeking clarification of Canada’s church affiliation went unreturned Thursday, as did a message to prosecuting attorney Donald Schmid.

Defense attorney Jeffrey Sanford did not return a message seeking comment, and Canada’s listed telephone number was disconnected.
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