The overwhelming generosity of Salvation Army donors was evident in the warehouses.
They were overflowing with playpens, deodorant, diapers, fruit cups, margarine, candy, bedding, expensive bikes, and so, so many toys from the Christmas Toy Mountain campaign.
Except these donations weren’t going to the shelters, food banks and needy children supported by the Salvation Army. They were being sold for profit.
The scheme to siphon off and sell “vast amounts” of donations was masterminded by David Rennie, the former executive director of the Salvation Army donation storage and distribution centre, according to a lengthy court decision released Wednesday.
The scheme took place under the guise of selling surplus donations to wholesaler Umaish “Tony” Ramrattan who would use that money to buy goods the Salvation Army was in need of — like meat, canned protein and kosher food.
Instead, Rennie began allowing Ramrattan to pick the best donations — toys and food that was far from its expiry date — and take it to another warehouse and sell it. Records seized by police show Ramrattan took away far more in donations than he returned in purchased goods, Bacchus found.
Trucks laden with donations from Nestle and Sun laundry detergent were re-routed to this second warehouse rented by Ramrattan at a steep discount price because the owner believed it to be affiliated with the Salvation Army.
Staff at the Railside warehouse, the location of the donation centre, became concerned that their shelves were empty and the quality of the donations they were sending out were declining even while Rennie continued to authorize Ramrattan to take donations. And when Railside needed some of those donations back, Ramrattan said he’d have to charge them, Bacchus found.
But the staff did not report their concerns about this because Rennie told them “he had the authority to do what he pleased,” Bacchus said. There were also rumours that turned out to be unfounded that Rennie had fired two employees for complaining about him.
Another excuse Rennie gave for the re-routed donations was that they needed the extra storage space — an excuse that didn’t hold up because the shelves at Railside were becoming increasingly empty.
In addition to siphoning off donations, Rennie had another cash-grab scheme, Bacchus found. In 2011 he started charging Faith Charities a cash-only fee of $500 a month to pick up surplus, damaged or unsuitable donations. The Salvation Army often shared or traded surplus donations with other charities and food banks in order to meet community needs but had a policy never to exchange the donations for cash or charge for that service.
Faith Charities, which catered to northern Ontario including indigenous communities, had been working with the Salvation Army since 2006 and never had to pay before.
The head of Faith Charities, a pastor named Rodney DeForge, agreed to pay the fee personally as a tithe. As time went on, the quality of the donations declined — the food was either packaged in a way that was unusable or too close to expiry, he said.
DeForge said Rennie also charged him $1,500 to get toys for a fundraising raffle — the toys were to be donated to the Salvation Army in Sudbury. But the toys he got were “trash” and could not be donated. After paying another $1,000 he got toys that were useable.
DeForge also testified Rennie asked if he wanted to “make a little money on the side” by distributing food, diapers and other products to corner stores. It was something Rennie said he was doing “down south” and it was going well, DeForge said. He said he refused, and that people would think he was selling donations.
Bacchus noted that Rennie had a motive for this fraud. Canada Revenue Agency documents seized from Rennie’s home by police show he owed $69,000. He made two payments of $500 towards that debt in January and February 2011.
It is unclear from the ruling just how many donations Rennie and Ramrattan took and how much they made from the sale of the donations, but Bacchus said the evidence that they were enriched through the scheme is “overwhelming.” In one example, she found Ramrattan sold 23 skids of toys for $7,000.
Rennie declined to comment following the ruling. A sentencing hearing has not yet been scheduled.
https://www.thestar.com/news/crime/...e-guilty-of-massive-toy-for-profit-fraud.html
They were overflowing with playpens, deodorant, diapers, fruit cups, margarine, candy, bedding, expensive bikes, and so, so many toys from the Christmas Toy Mountain campaign.
Except these donations weren’t going to the shelters, food banks and needy children supported by the Salvation Army. They were being sold for profit.
The scheme to siphon off and sell “vast amounts” of donations was masterminded by David Rennie, the former executive director of the Salvation Army donation storage and distribution centre, according to a lengthy court decision released Wednesday.
The scheme took place under the guise of selling surplus donations to wholesaler Umaish “Tony” Ramrattan who would use that money to buy goods the Salvation Army was in need of — like meat, canned protein and kosher food.
Instead, Rennie began allowing Ramrattan to pick the best donations — toys and food that was far from its expiry date — and take it to another warehouse and sell it. Records seized by police show Ramrattan took away far more in donations than he returned in purchased goods, Bacchus found.
Trucks laden with donations from Nestle and Sun laundry detergent were re-routed to this second warehouse rented by Ramrattan at a steep discount price because the owner believed it to be affiliated with the Salvation Army.
Staff at the Railside warehouse, the location of the donation centre, became concerned that their shelves were empty and the quality of the donations they were sending out were declining even while Rennie continued to authorize Ramrattan to take donations. And when Railside needed some of those donations back, Ramrattan said he’d have to charge them, Bacchus found.
But the staff did not report their concerns about this because Rennie told them “he had the authority to do what he pleased,” Bacchus said. There were also rumours that turned out to be unfounded that Rennie had fired two employees for complaining about him.
Another excuse Rennie gave for the re-routed donations was that they needed the extra storage space — an excuse that didn’t hold up because the shelves at Railside were becoming increasingly empty.
In addition to siphoning off donations, Rennie had another cash-grab scheme, Bacchus found. In 2011 he started charging Faith Charities a cash-only fee of $500 a month to pick up surplus, damaged or unsuitable donations. The Salvation Army often shared or traded surplus donations with other charities and food banks in order to meet community needs but had a policy never to exchange the donations for cash or charge for that service.
Faith Charities, which catered to northern Ontario including indigenous communities, had been working with the Salvation Army since 2006 and never had to pay before.
The head of Faith Charities, a pastor named Rodney DeForge, agreed to pay the fee personally as a tithe. As time went on, the quality of the donations declined — the food was either packaged in a way that was unusable or too close to expiry, he said.
DeForge said Rennie also charged him $1,500 to get toys for a fundraising raffle — the toys were to be donated to the Salvation Army in Sudbury. But the toys he got were “trash” and could not be donated. After paying another $1,000 he got toys that were useable.
DeForge also testified Rennie asked if he wanted to “make a little money on the side” by distributing food, diapers and other products to corner stores. It was something Rennie said he was doing “down south” and it was going well, DeForge said. He said he refused, and that people would think he was selling donations.
Bacchus noted that Rennie had a motive for this fraud. Canada Revenue Agency documents seized from Rennie’s home by police show he owed $69,000. He made two payments of $500 towards that debt in January and February 2011.
It is unclear from the ruling just how many donations Rennie and Ramrattan took and how much they made from the sale of the donations, but Bacchus said the evidence that they were enriched through the scheme is “overwhelming.” In one example, she found Ramrattan sold 23 skids of toys for $7,000.
Rennie declined to comment following the ruling. A sentencing hearing has not yet been scheduled.
https://www.thestar.com/news/crime/...e-guilty-of-massive-toy-for-profit-fraud.html
