BCSC Tri-West target Waage extradited to U.S.
2003-01-02 10:33 - Street Wire.
by Brent Mudry
After a nine-month extradition battle, Edmonton fraudster Alyn Richard Waage, the alleged mastermind of the $58-million Tri-West Investment Club prime bank scheme, has finally been extradited from Costa Rica to the United States, to stand trial in Sacramento, Calif. (All figures are in U.S. dollars.) Mr. Waage, 56, and co-conspirator James Michael Webb, 40, of California, were extradited on Dec. 19.
Mr. Waage and Mr. Webb were immediately ordered detained by Magistrate Judge Dale Drozd of United States District Court for the Eastern District of California pending trial, on the basis of flight risks. A preliminary hearing has been set for Jan. 7. The pair have been in custody since September, 2001, when they were arrested by the FBI in San Jose, Costa Rica, in co-operation with the offshore haven's national police. The United States Securities and Exchange Commission filed a civil complaint the same day against Mr. Waage, his sister Lynn Waage Johnston and Mr. Webb.
Mr. Waage and Mr. Webb, charged with numerous counts, face a potential five years in prison on each mail and wire fraud count, 10 years on each securities fraud count, and 20 years on each money laundering count. The pair also face fines up to double the value of their victims' losses.
Mr. Waage's arrest in Costa Rica capped an extensive international investigation by the FBI, assisted by the RCMP and securities regulators, including the British Columbia Securities Commission, and authorities in Costa Rica. U.S. officials estimate there are 13,000 Tri-West victims in more than 60 countries. "The Tri-West case is one of the largest Internet investment fraud cases in the country," state U.S. Attorney John K. Vincent and FBI Special Agent in Charge John Eckenrode.
Mr. Vincent told Stockwatch the international co-operation, including "valuable assistance from the Royal Canadian Mounted Police," proved critical to cracking the Tri-West case. Alyn Waage's Tri-West group, which operated through Haarlem Universal Corp. and other affiliates, used accounts and entities in at least seven offshore enclaves, including Costa Rica, Belize, Panama, Latvia, the Bahamas, Mexico and the Cayman Islands.
Mr. Waage is believed to have run the Tri-West operation since June, 1999, soon after jumping bail on another fraud case in Canada. Alyn Richard Waage, whose known aliases include Allan Richard Waage, Arthur Robert Davidson, Alyn Richard Dawson, Alan Richards, Arthur Robert Dawson and Jason Kingsley, is also wanted in Edmonton on a 44-count real estate fraud indictment. Mr. Waage also has four prior convictions for mail and wire fraud in Canada, according to RCMP Sergeant Tim Turner.
Mr. Waage, who had been operating in Mexico, was first arrested on April 19, 2001, with Patrick Clifford Elder, 54, also of Edmonton, and former Mexican police officer Gonzalo Cuevas Perez, 45, at the airport in Guadalajara after they flew in and forgot to declare $4.5-million in cash and equivalents, including 1,076 money orders and travellers' cheques made out to Haarlem Universal.
Mr. Waage told Mexican police he was en route to Riga, Latvia, to deposit the investor cheques into an account at JSC Saules Banka. Mr. Waage and Mr. Elder had been living in Puerto Vallarta for six months. Mr. Cuevas, the former second-in-command of the Puerto Vallarta municipal police force, claimed he had no clue about the huge cash shipment he was escorting. Mr. Cuevas, who resigned his police post on Dec. 28, 2000, told Mexican authorities that he was hired by Mr. Waage as a security guard on Jan. 4, 2001, three days after he set up a private security company with partner Pedro Escobedo Pulido, the former head of Puerto Vallarta's traffic police department. Mr. Cuevas told Mexican authorities that he, Mr. Waage and Mr. Elder kicked back a bottle and a half of whiskey on their short flight.
Behind bars in Mexico, the incorrigible Mr. Waage continued working the Tri-West scheme through the Internet, with the strong support of his son Cary Alyn Waage of Vancouver on the outside. With Mexico fast becoming too hot for comfort, the Waages relocated their operation to Costa Rica, a popular international destination for eco-tourists and financial fugitives, and set up shop in the former Ecuadorian embassy. Mr. Webb researched Costa Rican banks able and amenable to moving volumes of $10-million a month.
The elder Mr. Waage was locked up for four and a half months until he jumped $2-million bail in Mexico in August, 2001, and skipped to Costa Rica, where he was arrested a week later.
The junior Mr. Waage was arrested on Dec. 13, 2001, at Dallas International Airport, where he landed on U.S. soil en route from Canada to visit his father in jail in Costa Rica. The son, held without bail, pled guilty this April to one count each of mail fraud and conspiracy to commit money laundering, and awaits sentencing. His plea deal included an agreement to co-operate with authorities and to forfeit millions of dollars worth of ill-gotten assets, including properties in Mexico and Costa Rica, an $818,000 yacht, a $150,000 helicopter, numerous late-model vehicles and various bank accounts. |
