Egan: Sticky gold fingers — Royal Canadian Mounted Police allege inside theft at Royal Canadian Mint
by Kelly Egan, Ottawa Citizen On Sept. 16, in Courtroom No. 5, an Ottawa man is to appear on charges with a Hollywood ring: smuggling gold from the fortress-like Royal Canadian Mint. And not just a flake or two. Leston Lawrence, 34, of Barrhaven, is facing five criminal charges, including theft over $5,000, laundering the proceeds of crime, possession of property obtained by crime and, in the often arcane language of the Criminal Code, “conveying metal out of the Mint.” According to a document sworn by an RCMP officer, the charges relate to activity between Nov. 27, 2014 and March 12 this year. It was all kept hush-hush, of course. No news release from any law enforcement agency, or the Mint, headquartered on Sussex Drive; no amounts disclosed. But Ottawa is a small town where the sidewalks whisper. So a tipster called us. A Mint spokesman declined comment on the matter, except to say an unidentified employee had been terminated earlier this year. Curiously, Christine Aquino said the Mint had been “informed” of the charges by the Mounties, rather than instigating the investigation itself. In other words, the alleged theft appears to have gone undetected at the Mint. History might shed some light here, as the Mint has been victimized by inside jobs at least twice since it opened in 1908. And motive certainly meets opportunity: it had sales of 709,000 ounces of gold bullion in 2014 alone and production of some two billion coins. The earlier cases suggest that thieves initially get away with the actual stealing of the gold but get caught in the fencing. The charges, taken together, allege a similar thing happened in this case. One day in 1996, a Mint machinist named Richard Gauthier walked out — or somehow spirited out — 85 ounces of gold in eight bars. At his sentencing in 1998, a Mint official admitted they were never able to figure out how the precious metal left the building. As a consequence, the theft charge against Gauthier was dropped. There was speculation the Mint was happy with that news, otherwise it would have exposed its internal security systems, with all its sensors, scanners, cameras and what not, which apparently work some of the time. The court did hear that Gauthier sold the gold to a Hull man for $8,000, who flipped it to another company, who sold it to a legitimate metals company in Montreal, who tried to sell it back to the Mint. When the Mint saw the product, the jig was up. Crime, as we all know, doesn’t pay. Gauthier was handed a suspended sentence of nine months in jail — evading prison — and ordered to do 50 hours of community work. I found it curious that the Mint did not offer any assurance this week that, as a Crown corporation, it has the utmost concern for security and the latest technology to protect a valuable public asset. Or that it is reviewing measures in light of these allegations. So, mysteries abound. So does glitter: the Mint had revenues of $2.4 billion in 2014, the bulk of it from the sale of gold coins and bullion. These accusations of theft laid in July sit uncomfortably with the 2009 news — covered nationally — that the Mint had 17,500 troy ounces of “unreconciled” gold product on its books. In other words, millions in gold was missing and the Mint was not entirely sure whether it was a record-keeping lag or some grand heist. Even the RCMP was called in, finally concluding there was no evidence of a crime. Still, it looked bad. “First and foremost,” said an audit report, completed after much hand-wringing, “it was determined that the unreconciled difference was not the result of criminal activities, either by theft, fraud or reasons relating to data manipulations of the IT systems.” Well, if you say so. There was, too, a case in 1990 when a janitor was sentenced to a year in jail for stealing $30,000 in gold from the Mint. Court was told Revenue Canada investigators found George Allen, then 59, had roughly $150,000 in unexplained income between 1985 and 1988, not to mention some fancy toys, like a $37,000 boat and a $27,000 trailer. Similarly, a Mint security officer told court there was no way to know how much gold, in total, had gone missing. At this sentencing, the court heard that Allen, a 23-year veteran, was nabbed by a new walk-through metal detector. When it set off, an inspection found Allen was hiding something in his briefs. A search found 49 ounces of gold in his locker. Gary Barnes has been retained as Lawrence’s defence lawyer. He said his client, who is not in custody, intends to plead not guilty.