A Langley man has been sentenced in connection to a $93 million pyramid scheme that victimized people around the world.
Rajiv Dixit, 45, and his business partner, Chris Smith, 45, of Toronto, pleaded guilty in April to operating a pyramid scheme. They were each given a conditional sentence in Supreme Court in Ontario in May.
Both Smith and Dixit entered into plea agreements. Pursuant to these agreements, Dixit was fined $2.5 million and Smith was fined $1.43 million.
The first $50,000 must be paid by each within two years. The remainder must be paid within five years. If they do not pay their respective fines within five years there will be a ‘default hearing’ and a presumptive five-year prison sentence.
In a Supreme Court of Ontario hearing into the pyramid scheme’s financing, held in May 2016, it was learned that at the height of the scheme, Dixit had purchased five Mercedes Benz vehicles using funds from his Stellar Point bank accounts, placing the vehicles in names of Dixit Holdings. He also purchased jewelry, watches, clothing, the use of private jets and chartered flights.
According to a hearing in Supreme Court of Ontario, looking into the finances of the pyramid scheme, the judge laid out how the fraud was carried out.
Beginning in late 2010, tens of thousands of people from over 120 countries were induced to pay hundreds of millions of dollars to Banners Broker, a purported internet advertising business, which promised Banners Broker members the opportunity to double their money through participation and recruitment of others, explained the Supreme Court documents.
At the time, the court documents said, “Now defunct, the Banners Broker enterprise is currently subject to insolvency proceedings in Canada and the Isle of Man as well as ongoing criminal proceedings in Canada against Banners Broker’s principals, including the defendant Dixit, wherein the Crown alleges that Banners Broker was an illegal pyramid scheme.”
The Court appointed MSI Spergel Inc. as the Receiver in this case and they have determined that Dixit, a former principal and guiding mind of the Banners Broker enterprise, personally received $4.8 million US, either directly or through corporate entities under his ownership and control.
The defendant, Kaldip Josun, similarly received $3.8 million in affiliate funds.
Individual affiliates were told that with their money spent on Banners Broker advertising, products would be contributed towards advertising space on high-traffic websites and gathering advertising revenue based on the traffic to those advertisements. In reality, Banners Broker did not track website traffic, nor did it have access to high-volume websites, the Supreme Court hearing documents state.
During a press conference in December 2015, Ontario Police announced that Dixit and Smith were arrested in Toronto and charged with offences under the Criminal Code and the Competition Act in relation to fraud, possession of proceeds of crime and money laundering using an illegal pyramid scheme. The money was hidden in banks in the Bahamas and other places.
Dixit is a former resident of Whitby, Ont. and was a principal and guiding mind of Stellar Point, Dixit Consortium, Dreamscape and the Banners Broker enterprise. In August 2015, Dixit moved from Toronto to Langley, said the courts.
At least $1.28 million US was transferred to Dreamscape by various Banners Broker entities. Of that, approximately $240,000 US remains unaccounted for on the Dreamscape bank statements from its account at the Bank of Cyprus which have been reviewed by the Receiver, said Spergel to the impacted affiliates through a Facebook page.