Gambling Addict Steals From Dead Man

Former public trustee blames gambling addiction for defrauding dead man’s estate

 

By Ryan Cormier, Edmonton Journal

March 1, 2013

 

EDMONTON - A former public trustee was sentenced Friday to 16 months in jail after pleading guilty to a fraud that cost the Alberta government and a dead man’s estate more than $295,000.

Ned Ephraim Frohlich, 58, blamed his depression and a gambling addiction for a complicated fraud that involved fabricated documents, false identifications and a person he had invented.

 

“You have committed an act of considerable dishonour,” Court of Queen’s Bench Justice Sterling Sanderman said as he sentenced Frohlich.

 

According to an agreed statement of facts, Frohlich began work at the provincial Office of the Public Trustee in 1986. In November 1995, Frohlich began to administer the estate of William Vincent Thompson, a man who died without a will. To do so, Frohlich had to swear an affidavit that he would truthfully handle the estate and he became Thompson’s personal representative in March 1996.

 

During his work, Frohlich lied and said he had been in contact with Robert Thompson, a supposed nephew of the deceased. Frohlich created a story that the nephew lived in the United Arab Emirates and was the sole beneficiary of the estate money. In the next months, Frohlich created other documents that made it appear he and the nephew were settling the estate properly. He created a false social insurance number, birth certificate and Government of Alberta identification card for the nephew, Crown prosecutor Leah Boyd told court.

 

In June 1997, Frohlich deposited a cheque worth $102,361 of the estate money into a bank account he had opened under the false nephew’s name. Around the same time, the Office of the Public Trustee named Frohlich a senior trust officer.

 

In May 1998, Frohlich deposited another cheque worth $20,383 from Thompson’s estate.

 

According to an Auditor General audit of the public trustee’s office, Frohlich was not caught until 2010 when facial recognition software flagged his Alberta identification card as a fake. He was subsequently fired.

 

Though Frohlich stole $122,744 when he deposited the two cheques, Boyd told court that with accumulated interest now lost, the fraud cost the estate and public trustee office $295,353.

 

“I submit that this breach of trust is the epitome of breach of trust,” Boyd argued. “This was a person in the highest level of trust and authority with his employer. This conduct was persistent, planned and deliberate.”

 

Defence lawyer Alex Pringle said his client was a “tragic” man who was bowed low by depression, helplessly addicted to gambling, caught in a rocky marriage and disgruntled in his work because he believed he had been passed over for rightful promotions.

 

Frohlich’s gambling problems began in his late teens in Edmonton when he started betting on horse races, Pringle said.

 

“The problem was manageable until the Internet came along. He was soon placing bets on races across North America. There’s a sadness to this. He’s lost his profession. He will never practice law again.”

 

Frohlich stood and addressed the court just before he was sentenced. His family sat nearby.

 

“I can’t apologize enough to my wife and son for the shame and embarrassment,” he said. “I went crazy. I had to have been crazy to do that.”

 

Frohlich’s crime triggered a massive audit in the Office of the Public Trustee that took two years and cost $2.4 million, Boyd told court. It took thousands of hours and $1.5 million in costs just to audit 550 of Frohlich’s files, Boyd said.

 

The audit’s final report, released earlier this month, was scathing.

 

“We would have expected the Office of the Public Trustee, being in a position of trust, to have strong internal controls and rigorous management oversight to ensure that the property of vulnerable Albertans is properly safeguarded,” wrote Auditor General Merwan Saher. “Our findings ... demonstrate an overall failure.”

- See more at: http://www.edmontonjournal.com/health/Former+Alberta+public+trustee+blames+internet+gambling/8038468/story.html#sthash.IAOncJgP.dpuf

 

 

Auditor targets trustee office in probe into alleged theft of $120,000

Investigation underway into alleged theft

- See more at: http://www.edmontonjournal.com/health/Auditor+targets+trustee+office/7956875/story.html#sthash.0naO0FTq.dpuf