Fraudster who orchestrated sports investment scams deserves 7-year sentence, Crown says

The Crown is seeking a seven-year prison term for an Alberta man who used bogus connections in the hockey world to orchestrate a series of fraudulent sports investment schemes that cost his victims more than $1.7 million.

Nickolas Ellis is awaiting sentencing after being found guilty in Edmonton Court of King’s Bench on eight counts of fraud over $5,000, three counts of trafficking in forged documents and three counts of identity fraud.

Ellis, 52, engineered a series of elaborate frauds, often using his purported connections to current and retired NHL players, including the late New York Islanders great Mike Bossy.

His crimes, which took place between February 2016 and March 2019, involved eight victims.

Ellis defrauded friends, co-workers and neighbours, using fake emails, fabricated meetings and forged paperwork to lend legitimacy to his projects.

He was found guilty in January. As of Wednesday he had paid no restitution.

‘Pure greed’

In court on Wednesday, Crown prosecutor Thomas O’Leary said Ellis should be fully deprived of the “ill-gotten gains” of his crimes.

“His actions can be described as predatory,” O’Leary said. “In terms of the seriousness of the offences, it’s very high.”

Justice John Henderson, who described Ellis’s crimes as a “house of cards,” is expected to hand down a sentence in June.

O’Leary said the crimes were calculated and motivated by “pure greed.”

Ellis used the proceeds of his frauds to fund a lavish lifestyle — extensive travel, luxury vehicles and high-priced collectibles, the prosecutor said.

“He lived very comfortably, and did so off the backs of his victims.”

The Crown is seeking a “fines in lieu of forfeiture” order, used in cases when property or money obtained through a fraud can’t be found or recovered. If a fraudster doesn’t pay back that amount, the court can impose a fine that reflects the amount fraudulently obtained.

Such orders come with a threat of jail time. If imposed, Ellis could be incarcerated if a future court determines he has refused to pay within the sanctioned timeline, without reasonable excuse.

The Crown is also seeking a 15-year ancillary trust prohibition order. It would prohibit Ellis from having authority over finances, property, or investments when seeking future employment or volunteer work.

The Crown further asks that $21,000 seized from Ellis by Edmonton police be surrendered for redistribution among the victims.

The proposed sentence is harsh but necessary, O’Leary said.

Ellis was an experienced businessman who understood the severity of his crimes but continued to take money from his victims “because he could,” he said.

“Ellis carefully selected his victims, those closest to him.”

Ellis, wearing a checked shirt, black down vest and blue jeans for his court appearance Wednesday, stared straight ahead while victim impact statements were read — two from men who once considered him a friend.

The men wrote that the frauds have left them struggling with their mental and physical health.  Both wrote that they remain haunted by his betrayal, their finances gutted and plans for retirement shattered.

The largest of Ellis’s schemes was called the Dynasty Project — a group he claimed was made up of himself and current or former NHL players.

The pitch involved the supposed development of a sports app for NHL fans. Investors were promised millions or billions of dollars in returns on the closing of the sale to Microsoft.

Ellis used correspondence with fictional lawyers — and emails from a fake account in Bossy’s name — to add legitimacy to the scheme.

‘The Gretzky Project’

The second-largest scheme, known as the Reebok Jersey program, promised to take advantage of the NHL’s switch from Reebok to Adidas jerseys in 2017.

Ellis told investors that, thanks to his connections in the NHL, he had an opportunity to purchase more than 1,000 jerseys that could be repackaged and sold for profit.

In another scheme, known as The Gretzky Project, Ellis claimed to have a distribution deal with sports memorabilia company Upper Deck for limited-issue Wayne Gretzky merchandise.

Ellis took “very limited responsibility for his actions” when he was interviewed for a pre-sentence report, the report says.

He felt like his victims “still have everything” while he had “nothing,” he told his interviewer.

“He described himself as the ‘middle man’ when discussing the offence, and claimed he ‘felt like a pawn,'” the report says.

According to the report, Ellis is $300,000 in debt and has no assets. He said he currently earns about $1,500 a month in cash for acquisition work.

“The subject advised restitution would be ‘a tough pill to swallow’ but would be willing to comply,” the pre-sentence report says.

The defense will make submissions for sentencing later this month.

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