Fraudster pleads guilty to embezzling $1M while taking 13 first-class cruises in 4 years

A Calgary man admitted to defrauding two businesses out of $1,000,000 over four years in order to help support his first-class cruising habit, a judge was told on Thursday. 

He even gave his employers two loans to help keep their businesses afloat as he secretly siphoned off the cash.

Dale Sutherland, 68, pleaded guilty to fraud over $5,000. Sentencing will take place in the new year.

At Thursday's plea, Court of King's Bench Justice Jim Eamon heard that Sutherland's embezzlement took place between April 12, 2013, and Nov. 2, 2017.

Details of the crime come from an agreed statement of facts (ASF) read aloud by prosecutor Aaron Rankin. 

Sutherland was 'trusted' friend

Sutherland worked as an accountant and controller for the Kore Group and Kore Onsite, companies run by Brad LaForge and Kent Werner, two men who "considered Sutherland a friend and trusted him," according to the ASF.

Sutherland took annual vacations and "was quite open about the fact that he would spend a large part of this time taking first-class cruises via the Princess Cruise Line."

After he was fired, the Kore owners found records on his computer of his "extensive history" of these cruises.

The cruise record was filed as part of Sutherland's plea and shows that over the four-year period he was embezzling from the Kore companies, he took 13 cruises, spending 28 weeks on the water.

Payroll transfers 

According to the ASF, during that time, Sutherland was "fraudulently diverting significant additional money to himself from the Kore companies." 

The fraud was discovered in 2017 when Sutherland used an e-transfer to pay his own Amex.

When LaForge noticed, Sutherland lied, according to the ASF, and said the money was used to pay one of the corporate credit cards.

That incident triggered an investigation and Sutherland's termination.

Most of the money taken by Sutherland was done by setting up an account that received a biweekly payroll transfer called Werner KOS — one of the founders' names and the company's acronym.

'Mr. Sutherland's self-enrichment'

The investigation found Sutherland paid himself at least $850,000 through that account.

"All money paid to that account was going to another of Mr.Sutherland's bank accounts," according to the ASF.

Sutherland also had the owners sign cheques they believed would be used to pay corporate creditors but instead, he made the cheques payable to himself while recording corresponding entries in the accounting books for legitimate businesses.

"The third method of Mr. Sutherland's self-enrichment was simply electronically transferring himself funds, over and above any legitimate income, as and when he wished," reads the ASF.

Embezzlement hurt businesses on 'numerous occasions'

There were "numerous occasions" where Sutherland's embezzlement affected the businesses, according to the Crown. 

Rankin told the judge that Sutherland himself made two short-term bridge loans to Kore Companies so they could make payroll. 

Both owners took out mortgages against their personal assets during the time Sutherland was defrauding them to keep the companies viable, the judge was told.

Justice Eamon will hear sentencing arguments from defence lawyer Cory Wilson and Rankin in the new year.

At Wilson's request, Sutherland was given time to get his affairs in order.