THE CANADIAN PRESS
KELOWNA, B.C. - Three B.C. men swindled the government by manipulating the way they paid stumpage on logs harvested from Crown land, a Kelowna judge has ruled.
Prince George residents Kenneth Anderson, his brother Kevin Anderson and Gregory Spyker were each convicted this week of one of the biggest logging frauds in the province's history.
In his decision, B.C. Supreme Court Judge Geoff Barrow found the three cheated the government and other members of the logging industry who depend on a level playing field.
The Crown proved the men, who operated three timber sale licences near Pennask and Westwold, were able to predict which loaded logging trucks would be selected for random checks at a weigh scale.
By loading those trucks with high concentrations of low-grade logs - worth just one per cent, or less, of the value of logs slated for lumber - the men were able to influence the stumpage rate paid for all the trees cut in a given region.
The Crown says the scheme generated $300,000 to $600,000 in lost stumpage revenues and illegal profits from July 2006 to March 2007, and prosecutor Norm Yates will ask for jail time for all three men when a sentencing hearing takes place later this year.
Dean De La Mothe, who runs WoodX.com, a Penticton-based company that tracks all timber sales in B.C., was happy with the guilty verdicts.
"I think the logging industry will be pleased that the standards and process were upheld," he said. "There was so much wood not being billed properly . . . We wouldn't want business practices like that to continue."
Crown prosecutor Norm Yates couldn't prove exactly how Spyker and the Anderson brothers knew when a load would be chosen as a sample, but offered several theories during the trial.
The software used at the weigh scales picked samples on a quasi-random basis, which made it possible to recreate the selection formula, Yates said.
The Crown offered evidence showing Ken Anderson approached two computer programmers to simulate the scaling software to randomly select which loads would be sampled.
Another theory was the men kept records of which loads were sampled and ran a parallel scaling program, allowing them to project which truck would be selected next.
Or they could have acquired the protected password that gave them access to the scaling computer and see the sequence of random samples, Yates said.
The judge has ordered pre-sentence reports in advance of the sentencing hearings set for June.(The Kelowna Courier)
12:02ET 09-03-12
