The SEC states that through his company Axcess Automation, Gordon Driver fraudulently raised money from over 100 former investors in a ponzi scheme.

The SEC also states that Driver solicited funds from family, friends, neighbours and business acquaintances to wire transfer funds into bank accounts over which he had sole discretionary authority. Driver raised 14.1 million and told potential investors he had proprietary software, and would use their funds for trading “e-Mini S&P 500 futures,” promising returns of 1 to 5% a week.

The SEC says  Driver used $3.7 million  for trading, there was a loss of $3.55 million.

The SEC also states Gordon Driver hired finders to solicit new investors from their circle of family, friends and business acquaintances. Reynold and Ronald Mainse of Crossroads Christian Communications Inc and cousin David Rutledge who was a former Crossroads employee, were named by the Ontario Securities Commission as finders for Axcess Automation/Funds. Ronald Mainse and David Rutledge settled with the OSC in April 2010. An OSC hearing for Reynold Mainse and Steven Tayor was scheduled for April of this year.

From 2006 to 2009 the SEC says Gordon Driver operated as an unlicenced broker.
In February 2009, he sent out a false annual statement showing an account balance of over 9 million dollars for the year ending December 2008. The SEC says the actual balance was about $276,000.

The SEC decision comes two years after Gordon Driver was in California District Court.  A final judgement was issued prohibiting him from violating US federal security laws. The SEC  initial decision states:

Driver’s actions were egregious and recurrent. Driver engaged in a “ponzi scheme” spanning more than three years causing substantial harm to over 100 investors. He provided false and misleading information to certain of those investors and “finders.” Additionally, Driver used significant investor funds for his own benefit.
Driver acted with scienter. Driver had sole discretion and authority over the bank accounts into which he directed investors to wire transfer their funds. He had actual knowledge
of the trading losses he was incurring, while at the same time continuing to provide false and misleading information to investors regarding the account balances.
Driver has not admitted the wrongful nature of his conduct. In his Answer, he denies the Division’s allegations to which he previously consented, asserting several affirmative defenses.
Likewise, he has made no assurances against future violations. Throughout his Deposition, Driver asserted his privilege against self-incrimination under the Fifth Amendment. (Div. Ex. 4 at 5-40.) Without an associational bar, the potential for Driver’s future violations remains.
Further, the Commission has often emphasized, the public interest determination extends to the public-at-large, the welfare of investors as a class, and standards of conduct in the securities business generally.

Driver represented himself, after several delays. He was granted time to find a new attorney, was given 30 days to file his answer to the administrative judge and failed to meet the deadline. Driver received another extension to file his answer and did not file  opposition to the SEC motion.  The SEC has ordered:

that, pursuant to Section 15(b)(6)(A) of the Securities Exchange Act of 1934, Gordon A. Driver is barred from association with any broker, dealer, investment adviser,
municipal securities dealer, municipal advisor, transfer agent, and NRSRO, and from participating in an offering of penny stock.

The initial decision ruling was issued Thursday. Driver has 21 days to appeal upon receipt of the ruling, 10 days to file a motion to correct manifest error of fact and 21 days after that to file a petition for review. Appeals go before the full SEC Commission and if Driver’s appeal is unsuccessful he has recourse to go to US Federal Court. If there are no appeals by Driver or the SEC, the SEC will issue a final ruling.

There is no word on further decisions by the CFTC or the OSC. He is forbidden from trading in Canada. Gordon Driver lives in Las Vegas and has a home in Freelton Ontario.

When it comes to people involved, the case seems no closer to resolution as court dates are missed.
Canadians became aware of the alleged ponzi scheme when Reynold and Ron Mainse, hosts of 100 Huntley Street were yanked off the air in 2009. While Ron Mainse was re-instated to on-air host position and given the position of Crossroads spiritual director, viewers were told his brother Reynold had left Crossroads Christian Communications Inc. about a year and a half earlier.  100 Huntley Street viewers were pretty much left in the dark until Ron and his wife Ann (host of Full Circle) were interviewed on 100 Huntley Street before re-instatement a few months later. The Canadian tv ministry underwent significant management changes when news of the case broke in the US and Canada.

Gordon Driver, a Canadian who lives in Las Vegas and Freelton Ontario is being sought by the SEC.  Driver was a no show for an agreed US court date in February. The SEC issued an administrative order December 2010 regarding Axcess Automation with a 210 day deadline. The Hamilton Spectator:

Lawyers for the United States Securities and Exchange Commission are asking a judge to force a Freelton man accused of operating a Ponzi scheme to appear in a California court to answer questions under oath about his “ill-gotten gains.”

The SEC contends that Gordon Driver, who lists addresses in Las Vegas as well as Freelton’s exclusive Wildan Estates, has already been a no-show for a February deposition and has refused to respond to the SEC’s appearance requests.

Now the SEC wants a judge to compel Driver to appear so the SEC can determine how much money needs to be paid back and how large a penalty he should receive.

In a December 2009 agreement with the SEC, Driver agreed to turn over his “ill-gotten gains” and pay a penalty, according to the SEC.

Driver and his company, Axcess Automation, are accused of operating a $14-million Ponzi scheme that defrauded more than 200 Canadian and American investors with promises that they would receive returns on their investments as high as 5 per cent a week.

On Feb. 17, neither Driver nor his lawyer appeared at a scheduled deposition hearing in Los Angeles.

While US regulators try to to chase down Driver, the OSC starts another hearing Monday for Steven Taylor, a childhood friend of Gordon Driver, who is also alleged to have been part of the Axcess Automation/Funds 14 million dollar alleged ponzi scheme.

Ron Mainse, son of Crossroads founder David Mainse, and his cousin David Rutledge who is a former employee of Crossrads, settled with the OSC last year. They were named as finders and were ordered to pay back about 400 thousand dollars in commissions they received from their involvement with Axcess Automation/Funds, as well as administrative costs. The OSC found Ronald Mainse and David Rutledge were ‘not party to the fraud.’

The OSC does not have any documentation on a settlement with Reynold Mainse.

Driver was also a former Crossroads Christian Communications Inc. employee. The Mainse brothers and their cousin acknowledged drawing about a third  of approximately 200 investors into investing with  Axcess Automation/Funds.
Reynold Mainse statement. Ron Mainse videos.

To date, I’m not aware that any of the investors in the US or Canada have recovered a dime of the money they handed over in this religious affinity fraud case.

While religious affinity fraud is becoming depressingly common,  this on-going case made the 2010 OSC Enforcement Activity Report.

Working with the SEC and CFTC: Axcess Automation LLC

This case is an example of OSC staff working closely with other regulators, specifically the U.S. Securities and Exchange Commission (SEC) and the U.S. Commodity Futures Trading Commission (CFTC). This matter involved activity both in the U.S. and Canada.

In August 2010, the OSC concluded settlement agreements with two Ontario residents who traded in securities and futures contracts without being registered. The trading related to an investment scheme operating out of the state of Nevada by Gordon Alan Driver through his companies, including Axcess Automation LLC.

The OSC, SEC and CFTC have outstanding proceedings against Driver and the Axcess companies. Driver allegedly raised more than US$15 million from approximately 200 Ontario investors. In addition, the OSC has an outstanding related proceeding against two other Ontario residents who are alleged to have also traded in securities and futures contracts in Ontario without being registered to do so.

The son of 100 Huntley Street founder David Mainse and his cousin have been ordered to pay nearly $450,000 in restitution and penalties to the Ontario Securities Commission for their roles in an alleged Ponzi scheme created by a Freelton man.

Ron Mainse, an ordained minister and a leader of Burlington’s Crossroads Christian Communications, was ordered to repay about $138,000 in commissions he received from Gordon Driver, who is alleged by the U.S. Securities and Exchange Commission to be the mastermind of a $14-million US Ponzi scheme involving nearly 200 North American investors.

Mainse was also ordered to pay a $10,000 penalty and refrain from trading securities or becoming a director or officer of a company that reports to the OSC for eight years. Mainse’s lawyer, Jay Naster, turned over cheques for the entire amounts to the OSC at yesterday’s hearing.

David Rutledge of Ancaster, Mainse’s cousin and also an ordained minister, was ordered to pay back nearly $263,000 in commissions he received from Driver, pay a $35,000 penalty, and refrain from trading securities or becoming a director or officer of a reporting company for a period of 15 years.

Rutledge turned over a cheque for $90,000, has agreed to sell his Ancaster home to finance another $120,000 in restitution and will sign an undertaking with the OSC to repay the remaining $88,000.

The OSC’s lawyer pointed out there was no evidence that Mainse or Rutledge perpetrated any fraud themselves or were even aware that a fraud was being carried out.

The OSC also noted Mainse and Rutledge co-operated fully, voluntarily agreed to be interviewed and provided all documents requested. They will also appear as witnesses in the OSC’s ongoing case against Driver, an associate of his and several of their companies.

…A settlement has not yet been reached with Reynold Mainse, another son of David Mainse, who is also part of the OSC’s investigation into Driver’s investment scheme.

The OSC has indicated that Reynold Mainse, like his brother and Rutledge, is not considered a party to the alleged fraud.

Hamilton Spectator

Ron Mainse, former Crossroads Christian Communications Inc. President is now Crossroads Spiritual Director and Executive Producer of 100 Huntley Street.
Reynold Mainse has subsequently appeared on 100 Huntley Street reporting on Crossroads missions.

Ron and Reynold Mainse were yanked off the air as hosts of Crossroads flagship show 100 Huntley Street in June of last year. Ron was re-instated as a 100 Huntley Street host in November. He stated in a televised interview his brother Reynold and wife Kathy had not been employees of Crossroads for about a year and a half.

A US reader asked a few weeks ago if rumours of restitution were true. The OSC hearing was held Friday. David Rutledge was the former Crossroads Christian Communications Inc. Director of Ministries. Reynold Mainse was Crossroads Vice-President of Missions. Ron Mainse said he drew about 50 or 60 people into the scam, Reynold says he involved 15. The OSC says Reynold and Kathy Mainse drew 22 investors in (at 250 thousand dollars a unit). The OSC settlement agreement with Ron Mainse states 45 investors were taken in. Mainse learned in 2008 a lawyer was concerned about the Axcess commissions. He took another 30 thousand dollars and stopped being a finder. He told the OSC he gave most of his finders fees to charities.
Rutledge and the Mainse brothers are ordained ministers with The Pentecostal Assemblies of Canada. Gordon Driver of Axcess Automation is from Freelton Ontario and Las Vegas.

Ontario Securities Commission August 13, 2010 David Rutledge/Anesis Investments
Ontario Securities Commission August 13, 2010 Ronald Mainse
Ontario Securities Commission August 12, 2010 Statement of Allegations (.pdf)

From the OSC Statement of Allegations:

Rutledge, Reynold Mainse and Ronald Mainse

30. Between July 2007 and March 2009, Rutledge’s trading in the Axcess Automation Investment resulted in investments by about 45 investors totalling approximately USD 2,051,199.39. Of this amount, Driver paid back about USD 746,507.00 to these investors, which Driver characterized as returns on investments.
31. Rutledge provided prospective investors with copies of the Private Offering Memorandum which described the Axcess Fund Investment.
32. Rutledge received commissions directly, and through 6845941, of about CAD 262,818.92.
33. Between July 2007 and March 2009, Reynold Mainse’s trading in the Axcess Automation Investment resulted in investments by about 22 investors of about USD 4,100,000.00. Of this amount, Driver paid back about USD 2,875,054.00 to these investors, which Driver characterized as returns on investments.
34. Reynold Mainse identified and corresponded with prospective investors and provided them with copies of the Private Offering Memorandum which described the Axcess Fund Investment.
35. Reynold Mainse received commissions directly, and through WCC, of about CAD 210,219.50.
36. Between July 2007 and March 2009, persons introduced by Ronald Mainse to the Axcess Automation Investment invested about USD 86,200.00. Ronald Mainse received commissions of about CAD 138,176.88, most of which were derived from investors in Rutledge’s group.

The document is a sobering read –  conduct contrary to the public interest indeed. I’m counting 9 companies involved.  Over 100 investors were scammed, most were Canadians. For background on the Axcess Automation/Funds ponzi scheme follow the tags at the bottom of the post. Prior posts include US regulatory body and court documents.  Crossroads CEO Donald Simmonds who was quietly brought in late last year reiterated that David Mainse sons were Gordon Driver’s victims, a position taken by the religious broadcaster since the story broke last April.

“One of our strong points in the Christian community is that we’re known for trust, but that trust can be taken advantage of or turn into naiveté at times. They were trusting, perhaps to a fault at that point.”

The OSC alleges
- David Rutledge made commissions of 262,818.92.
- Reynold Mainse made commissions of 210,219.50.
- Ron Mainse made commissions of 138,176.88.

Who gets the restitution money? Lawyers? The government? Investors? (called third parties)

Even a New York Times blog is reporting the Axcess Automation/Funds Mainse brothers involvement. I’m posting the Crossroads Christian Communications Inc. statement below the fold in full because it’s been my experience Crossroads posted information has a habit of becoming disappeared.
Crossroads Pleased OSC Hearing Brings Closure to 15-Month Ordeal
Regulator Concludes Mainse Brothers “Not party to the fraud”
BURLINGTON, ONTARIO – August 13, 2010. – Yesterday, the Ontario Securities Commission issued a notice of hearing and statement of allegations relating to a fraudulent investment fund scheme targeting the Canadian faith community, orchestrated by Gordon Driver, which was exposed by the security regulators in May, 2009.

Ron Mainse, currently on the leadership team at Crossroads, and Reynold Mainse and David Rutledge, formerly associated with Crossroads had, on a personal basis, invested in the fund, informed family and friends about the fund and were offered a share of Mr. Driver’s profits. They were unaware that the enhanced returns Mr. Driver claimed to realize were, in fact, based on the alleged fraudulent investment scheme.  In yesterday’s statement the OSC clearly concluded that they “were not party to the fraud”.

During the summer of 2009 a thorough, independent financial audit initiated by the Crossroads Board of Directors confirmed that no Crossroads ministry activity nor any of its funds were in any way involved.

In a nationally televised interview last October on 100 Huntley Street, Ron Mainse openly talked of how he had naively placed his trust in Mr. Driver, whom he had considered a family friend, and did not exercise sufficient due diligence about the supposed investment. Further, he had not appreciated that the receipt in any form of compensation from Mr. Driver was a breach of the Securities Act.

Ron has cooperated fully with staff of the Ontario Securities Commission and has entered into an agreement that was approved at a hearing today, bringing appropriate closure to the matter.   The agreement immediately resolves the Commission’s allegations by acknowledging Ron’s mistake, abiding by an appropriate sanction and completely reimbursing any compensation received.

Unfortunately, the faith community can be easily taken advantage of because it highly values trust in relationships. This situation underscores the need for greater awareness and diligence to avoid vulnerability. Crossroads hopes this terrible experience, now concluded, can be used as a caution to others.

Judge Otis D. Wright II of the U.S. District Court for the Southern District of California has vacated the hearing in this matter that had been scheduled for March 5, 2010 at 3 pm

US Commodities Futures Trading Commission

Where is a lawyer when you need one? :^)
Can  US readers help me out here?

The legal dictionary says to vacate means to void, annul, set aside – I think this is comparable to what I would understand as cancelling or staying the hearing.
If it means cancel  it can be for all kinds of reasons. The court ran overtime,  a court employee is ill or unavailable…

This was to be a hearing on “Issuance of Order to Show Cause Why Defendants Should Not Be Held in Contempt.”

The civil case against Gordon Driver/Axcess Automation/Funds was filed by the CTFC and the SEC in May 2009.

In December 2009  Gordon Driver,  a Canadian living in the US, made a deal with the SEC.

A Freelton man accused of running a $14-million Ponzi scheme has agreed to turn over his “ill-gotten gains” and pay a penalty following a settlement reached with the U.S. Securities and Exchange Commission (SEC).

Gordon Driver and his company, Axcess Automation, reached the agreement just days after the SEC had gone to a California court seeking a contempt order against Driver for not complying with previous court-ordered requirements.

The SEC was also asking the judge to consider jail time as a possible sanction against Driver if he was found guilty of contempt.

Has Gordon Driver and the SEC had a hearing to determine the money he has to turn over and the amount he faces in fines?

Another question for US friends.
If the SEC makes a deal, does that void the action the CFTC is taking?

100+ people, mostly in Canada, many connected to Crossroads Christian Communications Inc. lost a lot of money.
Gordon Driver, David Rutledge and Steven Taylor were given a cease and desist order by the Ontario Securities and Exchange Commission even though funds where not traded in Canada.

If the SEC deal with Driver had been approved by the court (California) wouldn’t the settlement be posted on the SEC website?

A lot of people were harmed in this ponzi scheme, Ron and Reynold Mainse  of Crossroads have not only admitted being finders, but also admitted investing. It must be very difficult to not see justice for Axcess victims unnamed and silent in this scam.

As the OSC order says:

AND WHEREAS pursuant to subsection 127(8) of the Securities Act, satisfactory information has not been provided to the Commission by any of the Respondents

The case number for the SEC is Civil Action No. CV 09-3410 ODW
The case number for the CFTC is Case No. 09-CV-0578 ODW (RZx)

Ron Mainse was put back on air after being yanked in June. The Driver/Axcess scheme came to light in April/May 2009. You can watch his return  on Part 1, Part 2 and Part 3 in his interview with Jim Cantelon. Mainse was demoted to spiritual director after his public admission of his involvement.

As well the non-profit Crossroads Television System went through posting of a non existent charity in the fall of 2009 and winter of 2010. It has since been removed although there has been no public acknowledgement of wrong doing.
A summary of the media organizations tough year is here

The credit I want to acknowledge is a more honest portrayal of Crossroads CEO/Chairman Don Simmonds who came to the organization in October although it was not announced until December with an erroneous pr to ChristianWeek in December.

As part of the Crossroads social media rollout (which I’ll blog out more later) Simmonds has a page up at Crossroads corporate which does not reflect the error in the pr handed to Christian Week. If we can be faithful in small things, the parable in Matthew 25:21 NIV says we will be put in charge of larger things. Luke 16:10 (NIV) says “Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much.”

Jim Cantelon mentions in the roll out this week that Crossroads is innovative in their movement into social media, that observation is not quite true in Canada or  US religious media. Competition is fierce and The Miracle Channel  and Grace TV have been using social media for some time including Twitter and Facebook. As well other religious programs broadcast in Canada have also utilized You Tube, Facebook and Twitter. Some of the Crossroads social networks have been registered for some time and have been very poorly utilized. Time will tell if the younger demographic joins in.

You can see the social media discussion on the March 8 to 12/10 programs.

The error in the ChristianWeek pr has not been acknowledged, but kudos to Crossroads in being careful with the copy that is now up on their site about the CEO/Chairman. Every honest small step aids damaged public perception.. Jim Cantelon mentions Crossroads is innovative in their movement into social media, that is not quite true in Canada. Religious media competition is fierce and The Miracle Channel  and Grace TV have been using social media for some time.

Still, I want to commend Crossroads for this weeks 100 Huntley Street effort to announce honest, technologically updated and more transparent steps.

A Freelton man accused of running a $14-million Ponzi scheme has agreed to turn over his “ill-gotten gains” and pay a penalty following a settlement reached with the U.S. Securities and Exchange Commission (SEC).

Gordon Driver and his company, Axcess Automation, reached the agreement just days after the SEC had gone to a California court seeking a contempt order against Driver for not complying with previous court-ordered requirements.

The SEC was also asking the judge to consider jail time as a possible sanction against Driver if he was found guilty of contempt.

Driver and his company are alleged to have defrauded more than 100 Canadian and American investors since 2006 by promising them weekly returns on their investment as high as 5 per cent, based on special software he says he developed to trade futures.

Among those who invested in the alleged Ponzi scheme, court documents say, are two sons of David Mainse, founder of Burlington’s Crossroads Television and 100 Huntley Street.

A court hearing will be held to determine the amount of money that Driver must turn over and the size of the penalty he faces.

That agreement didn’t deal with the civil suit filed by The US Commodity Futures Trading Commission.  The CFTC keeps web pages of their on-going cases and there is an entry February 2, 2010.

Court orders continuance of February 5, 2010 Order to Show Cause Hearing to March 5, 2010 at 3:00 pm in the courtroom of the Hon. Otis D. Wright II, US District Court, Central District of California.

I’m not a lawyer and I don’t play one online. As I understand the above, the CFTC (plaintiff) wants the court to decide why the defendants (Gordon Driver/Axcess Automation) …Should Not Be Held in Contempt.

The Spec:

As part of the agreement with the SEC, Driver will be prevented “from arguing that he did not violate the federal securities laws as alleged,” and can’t challenge the validity of the agreement in court.

The agreement also requires Driver to acknowledge that the deal with the SEC does not provide him with any immunity from possible criminal charges.

It took a story in the ‘local’ newspaper (The Hamilton Spectator) mid-May to get people to start to notice all was not well at the Burlington broadcast behemoth. One of the many things that fascinated me was how slow the Canadian religious broadcaster was to respond. For awhile this  blog was busier than normal, as a few thousand people who cared wanted the news, gossip, facts, speculation, details. You know, stuff. People want to talk back now, not be talked to, and blogs are good for that.  Crossroads isn’t suffering from scandal and economic downturn as much as indifference, as a few boomer fans hang on.  Millennials and the rest of us moved on a long time ago.

By June 2009 Crossroads Christian Communications Inc. flagship show 100 Huntley Street responded with a very dramatic black outfit, black background announcement that Ron and Ann Mainse and Reynold and Kathy Mainse had er, stepped aside to deal with personal issues.The dramatic hype would have been funny if so many good people hadn’t been so badly burned. The appropriate board announcement went up on the appropriate corporate web page. Those announcements have disappeared now. Broadcasting is a business first, ministry second, and when it comes to image and bottom line, marching on matters.
As with most events, this one played itself out and it has been painful to watch the good ship Crossroads attempt to right itself. David Mainse stepped in to help guest host his TV show; (he supposedly retired after heart surgery in 2003) not one but two fundraisers were run, and Canadian religious media gave the story gracious space. Interestingly enough as who did what, lost what, and what was going on got sorted out, sister ship CTS found itself floundering with a non-existent charity. Revenue Canada meant what it said last summer when it told Canadians the Charity division was clamping down and clearing away the trough feeders. Media didn’t even bother touching the CTS piece of news. Even industry blogs haven’t bothered.
Re-runs are still being re-run, it’s taken months for this once dominant flag show staff to do simple things like update web pages.

I have no idea how much money Crossroads lost when the founders sons finally admitted they had been finders in what viewers realizewas not an ‘alleged’ ponzi scheme. During the second fall donor drive I think it was mentioned the budget was about 30% short. The public eventually learned the brother hosts were both victims and victimizers, sincere promises were made of restitution, and that was that. We’ll never know because in a top down medium such as TV, in a mentality stuck in the glory days, it’s none of our business. It’s just not Christian to talk about these sorts of things. None of the Imagine Adoption or Earl Jones response for the 100 Huntley Street fan base and the scalded.

The glossy media magazine Compass, once popular for 100 Huntley is still getting pumped out for faithful donators, and hosts get to preach in print.

During the summer Crossroads began scrubbing tidying up it’s web presence, but whoever was in charge of that has been oddly reluctant to let go of the familiar. Perhaps given the potential upset, decisions were made to bridge the world of who gave while making desperate moves to find new givers. While Ann Mainse showed up to the studio to help ask for money, Ron’s grand TV re-entrance was more carefully staged. He swallowed hard and put a brave face on his demotion to spiritual director/executive producer. It was not public business whether salary was drawn during personal time off. Upon the two day return fanfare, faithful viewers were told his brother and his wife had not been on staff at Crossroads for about a year and a half and wouldn’t be coming back.  A sentence toss-off, and the show went on.

Viewers are still asking where Reynold and Kathy are on the 100 Huntley Facebook page. But hey, the broadcaster has a Facebook page, and they are trying to Twitter.  The feed reads like a long lonely commercial, a Twitterer without re-tweets. The 100 Huntley You Tube channel is faithfully chopping up the show into YouTube sized pieces for the mobile crowd, and the good ship Crossroads got around to announcing in December they had a new CEO who had been on the job since the end of October. “New” media (the internet) is being introduced on 100 Huntley Street set with the predictable sputters and epic fails. I did mention it is painful to watch, didn’t I?

When the catastrophic earthquake hit Haiti, 100 Huntley managed to snag Canada’s outstanding World Vision President and CEO Dave Toycen, who was on his way to the airport to get to the devastated country. It was an excellent interview, almost as good as his soundbite on Hope Haiti. If 100 Huntley had not solicited funds that day for their Haiti help they may have upped my respect. If they had just directed viewers to give to the outstanding work World Vision Canada does and is doing, they may have won some brownie point with unsure viewers.

Knowing how far behind 100 Huntley is in responding to world wide catastrophes,  a Haiti special aired January 23. I give them credit for attempting to showcase lesser known Canadian ministries, but as common with live shows, static formats feeds from Haiti understandably broke down and most pictures used had been splashed around world media and absorbed by compassion weary viewers. Sincere but dated,  the asking for funds for Crossroad Haiti relief seemed tacky as the quick scoring the interview with  Dave Toycen was a coup for Crossroads.

Use teh google, type in 100 Huntley Street and this blog is still on the first page. I don’t think this aside will surprise my readers, but that saddens me. The posts about what really has been a long demise accelerated by a ponzi scheme are…I don’t know what they are really. Posts, almost ghost posts, on a group of people running a show ministry which is as stuck as the 1993 CRTC religious broadcasting regulations, I guess.
The broadcaster is starting to push their way back to the top of the search engines. This week 100 Huntley finally got around to updating it’s front web page to match reality.

This simple change ( a picture sans brother Reynolds and Kathy) took almost a year from the time the public began to learn Gordon Driver and Axcess Funds boot stomped his way through the bubble with the brothers trotting behind.

Life changing media.

For Crossroads the past 10 months has been.
Haven’t they?

The questions were simple. If a non-profit Canadian religious broadcaster asks for money, any potential donor need to be able to ask:

a) By what authority does CTS broadcast advertising which solicits public funds?

b) By what authority does CTS under CITS Media Research Organization/CITS Media Resources Organization claim to issue tax receipts?

On this Friday evening in the news dead zone time I received this response:

Thank-you, Bene Diction, for your inquiry. CITS Media Resources Organization launched in the winter of 2009 and applied for charitable status with the Canada Revenue at that time. We received notice from the CRA in December that this application was refused. While we consider our next steps, all parties donating to CITS MRO have been contacted offering a refund of their donation(s).

Best regards,
Iner Smith
Development Representative

This has been such a mess and what CTS has done is wrong.

So much hassle  could have been avoided if CTS (Crossroads Television System) had been upfront and open from the day readers of BDBO and viewers of CTS discovered Hope for TV and CITS Media Research or CITS Media Resources Organization (depending which page you read on the religious broadcasters webpage) was operating as a charity without federal authorization.

What is really going on with one of Canada’s largest religious broadcasters?

Why would Crossroads management and employees jeopardize their broadcast licence this way?

Even as a CTS employee publicly acknowledges what they were doing is not legal, Hope for TV and CTS Our Cause web pages remain up. In fairness to CTS, the solicitation fields at CTS Our Cause have been taken down.
Some of the information at the Hope for TV website was taken from a US religious group which has now closed it’s doors. CTS  has kept the commercials online, whether or not they are still being aired is unknown.
The non profit arm of Crossroads Christian Communications Inc., (CTS) is now answering to The Canadian Broadcast Standards Council and Revenue Canada Charities.

Here is a timeline of events for CITS Media Research Organization/CITS Media Resources Organization/Hope for TV, CTS Our Cause/CTS The Cause.

• October 2, 2008: A letters patent application is made in Burlington Ontario by CTS to Industry Canada for CITS Media Resources Organization
• October 27, 2008: The CITS Media Resources Organization application is Gazetted (granted) Industry Canada file #449772-4
• September 2009: CTS (Crossroads Television System) registers a website: Hope for TV
• Time unknown: CTS puts up Our Cause explaining CITS Media Research Organization or CITS Media Resources Organization
• Time unknown: Hope for TV (CTS)  puts four broadcast ads and copy on its website.
• All website links at Hope for TV go straight to CTS Our Cause (CITS Media Research Organization/CITS Media Resources Organization). The public is asked for money, and provided with two donation fields, one of which said tax receipts will be granted at the end of the year.
• Time unknown: CTS begins broadcasting Hope for TV advertisements across Canada, asking for viewer donations in violation of it’s broadcast licence

I do not feel one bit sorry for CTS management. As paid professionals overseeing broadcast operations, it was their responsibility to honour their mandate.  It was only after concerned viewers raised the issue did this public grab for money stop.
I feel badly for CTS on-air personnel whose images were used in the false advertising by mail and online. Not one responded to my email.  They have jobs to do, and their management betrayed them.  Their trust and good will has been betrayed.
I feel badly for viewers who trusted CTS.
This is the second time in a year the house that David Mainse built has been scandalized and exposed; first when 100 Huntley Street hosts were found to be finders in  the 14 million dollar Gordon Driver/Axcess ponzi scheme, and now with  the non-profit arm of Crossroads admitting they did not have the authorization to run a charity and ran it anyway.

We are all harmed when Christians chose not to operate ethically.
While CTS has finally acknowledged Our Cause is not a charity, no one wins.

I don’t know how much money CTS has to give back.
I don’t know if CTS will be fined for running an illegal charity.

A broadcast licence is a privilege, not a right. Public trust is not something Christians in public spaces can toy with. CTS is not a new kid on the Canadian TV dial and it is disheartening and sad to have watched this organization so egregiously abuse the trust of the public and the trust given by the CRTC in it’s licencing of CTS.

I am deeply disturbed CTS management made the decision to ignore viewers who asked legitmate questions weeks ago, and there is no joy in the reality this has had to be drawn to the attention of federal regulators before CTS chose to move toward doing the right thing.

I commend Revenue Canada Charities and The Canadian Broadcast Standards Council for promptly fulfilling their responsibility to taxpayers.
I doubt it was easy for Mr. Smith to send that email.
I commend concerned CTS viewers for stepping forward and asking questions to CTS and for recognizing and fulfilling their responsibility as citizens and consumers.

A Hamilton-area man accused of running a $14-million US Ponzi scheme has agreed to turn over money and pay a penalty following a settlement reached with the U.S. Securities and Exchange Commission.

Gordon Driver of Freelton, Ont., and his company, Axcess Automation, reached the agreement just days after the SEC had gone to a California court seeking a contempt order against Driver for not complying with previous court-ordered requirements.

The SEC was also asking the judge to consider jail time as a possible sanction against Driver if he was found guilty of contempt.

Driver and his company are alleged to have defrauded more than 100 Canadian and American investors since 2006 by promising them weekly returns on their investment as high as five per cent, based on special software he claims he developed to trade futures.

A court hearing will be held to determine the amount of money that Driver must turn over and the size of the penalty he faces.

Winnipeg Sun
Winnipeg Free Press

The main story is at The Hamilton Spectator.

Contacted by e-mail Saturday, Driver declined to answer questions about the agreement.

“I don’t think you know how to be fair and balanced,” Driver responded.

“You have missed the opportunity to find the real story.”

As part of the agreement with the SEC, Driver will be prevented “from arguing that he did not violate the federal securities laws as alleged,” and can’t challenge the validity of the agreement in court.

The agreement also requires Driver to acknowledge that the deal with the SEC does not provide him with any immunity from possible criminal charges.

Nothing up as yet at the Security Exchange Commission website.

The CFTC  Case Status Report Website:  

January 11, 2010

 

At the 1:30pm Hearing in US District, Central District of California (Western Division – Los Angeles) before Judge Otis D. Wright II on Plaintiff’s Motion for Issuance of Order to Show Cause Why Defendants Should Not Be Held in Contempt.

News of the alleged ponzi scheme involving Gordon Driver/Axcess Automation Funds, broke in Canadian media in May.

In June the board announced Ron and Reynold were being taken off the air. The announcement made on 100 Huntley Street was followed by an interview by CEO Doug McKenzie at Marantha News and a written statement on the corporate webpage. The June 4th TV announcement yanking the hosts off air also appears to have been taken offline.*

The civil case against Driver had been filed in the US by the SEC April 19th and CFTC in May. The Ontario Securities Commission issued a temporary order April 15th. Over 100 investors are believed to have been affected in the 14 million dollar alleged ponzi scheme.

Here is the timeline and a list of documents, statements and media coverage.

Why has this religious television charity removed critical information regarding steps by the board around this alleged ponzi scheme involving Ron, Ann, Reynold and Kathy?

* The transcript of the TV board statement June 11, 2009 is gone
The June 14,2009 statement by CEO Doug McKenzie is gone
The statement by The Canadian Council of Christian Charities August 24, 2009 is gone.

Does this Crossroads Christian Communications Inc. corporate link work for you?

The page now contains the following:
CCCI Statement – July 17, 2009
Statement by Ron Mainse to Viewers/Supporters of Crossroads – September 14, 2009
Statement by the Board of Directors – September 14, 2009

This summer, Crossroads scrubbed and updated it’s webpages. It appears information removal is occurring again. David Rutledge, named by the Ontario Securities Commission had remained on Crossroads webpages as Director of Ministries long after he left to work for  Gordon Diver/Axcess Funds.
During  his ‘return to air’ October 10th interview with Jim Cantelon, Ron Mainse mentioned Reynold and Kathy Mainse had left 100 Huntley Street about a year, year and a half ago to work on their own ministry. (Heaven’s Rehearsal) Their pictures remain on the Crossroads site.

And here.

The webpages aren’t up to speed but  important public documents have been taken offline. Why?