Ex-Impact owner probed

[Impact supporter]

Appearing in Montreal Gazette

Police probe ex-Impact owner

Prominent member of Greek community

Gavriil accuse of defrauing clients of his mutual-fund dealership to repay a debt

Don MacDonald The Gazette

One of the local Greek community's most prominent entrepreneurs has disappeared amid allegations he bilkedclients of their savings. He is now the target of a major police investigation.

Efstratios(Strato) Gavriil, former president of the Ionian Financial Group, is accused in regulatory proceedings and civil litigation of defrauding clients of his mutual fund dealership to repay a debt to a person who was threatening his life.

Gavriil, named 2001 entrepreneur of the year by the Hellenic Chamber of Commerce, has dropped out of sight in recent months. Once the owner of the Montreal Impact soccer team, he is now rumoured to be in hiding with his family.

Gavriil is accused of defrauding his clients of more than $1 million and falsifying his records last year in a decision issued last month by the provincial Chambre de la sécurité financière. One of those clints, leonard April, was defrauded of about &700,000 US, according to the Chambre.

April has brought a $1,2 million lawsuit in Superior Court against Gavriil and other officials of Laval-based Ionian and its subsidiary ISL Asset Management which are now closed.

In January 2003, April agreed to invest $701,500 US with Gavriil in a series of mutual funds. But he quickly became dissatisfied with the way the mone had been handled.

In May, he asked for his investments to be cashed out and the money given back, his suit states.

Gavriil eventually agreed to give him back his money in a series of post-dated cheques. But the first heque bounced and April was given the runaround for two weeks until he finally threatened legal action to get his money back. Finally, the two men met on July 31.

''To(April's) shock and horror, Gavriil admitted to him that he had never invested any of the money'' the lawsuit states.

''He had instead diverted Plaintiff's money and paid personal debts to a certain individual who had invested and lost money and who had reportedly threatened his life.''

In an interview, April's lawyer Robert Torralbo added: ''(Gavriil) told me at a meeting...that a gun had been put to his temple, to his head, and if he didn't hand over a lot of money that his life was in danger as well as his family''

''Now if that's true, I don't know''

Gavriil begged April not to sue him or report him to authorities, promising to repay him with the proceeds of a business deal he was on the verge of completing. Gavriil paid April $85,000 on May 5 and $50,000 US on June 17. He had already reimbursed April $12,500.

In August, Gavriil managed to cough up another $100,000, but April hadn't received any more money by mid-September, according to the lawsuit.

On Spt. 12, Gavriil told April he and his lawyer, Tom Markakis, were flying to the Caribbean island of St. Vincent with a group of investors to meet with his banker, Swiss Trust Bank, and that ''Gavriil would wire to plaintiff on Sept 19 the entire amount owed to him,'' the lawsuit states.

There was no wire transfer nor any further payments.

The Chambre de la sécurité financière's decision accuses Gavriil of defrauding four other clients for a total of more than $180,000 last June in what appears to have been a frantic bid to gather money to repay April.

A Montreal financial professional familiar with Gavriil's firm said its clients were mostly unsophisticated, small savers from the Greek community.

Eugene Czolij, a lawyer who has represented Gavriil in court proceeding, said his firm no longer represents Gavriil and he doesn't know where he is.

A spokesman for Laval police said his force and the Sureté du Québec are conducting a mojor fraud investigation into Gavriil's dealings.

dmacdonald@thegazette.canwest.com