Pyramid Scheme Alert (PSA) provides current and historical news items that are of interest to our members and visitors. None of the reports or commentaries is intended to imply that any of the referenced companies have been charged or convicted as illegal pyramid schemes.
A Letter To The Honourable John Wilkinson: Regarding Pigeon King International
April 4, 2008
Honourable John Wilkinson, M.P.P.
Minister of Research and Innovation
Ferguson Block, 12th Floor
77 Wellesley Street West
Toronto ON M7A 1N3
As per our discussion at the Drayton Farm Show on Thursday, April 3 I am writing to you about the concerns in our community that Pigeon King International (PKI), Waterloo, Ontario is a Ponzie scheme.
As a former employee of PKI, I am nervous about the large investment of Canadian family farms in this corporation. I was employed from August 2005 to February 2006 and still today I receive a large amount of phone calls regarding PKI.
I was hired as a US sales consultant to expand the PKI US operations. At the time of employment PKI had approximately 36 Canadian farms and 7 US farms. The corporate message stated the need to expand in the US due to the strong demand for high-end pigeons (Ex. Racers, Tumblers, High Divers, Show Pigeons, etc.). Urgency was the order of the day due to the avian influenza scare which could have affected border closures. If the borders closed, PKIs inability to send product across the US border would severely handicap the companys growth potential.
In our country we have the freedom to capture markets by creating innovative industry. During my employment there, I was highly involved in the rapid growth of PKIs US customer base where it rose approximately 800% (to well over 100 farms). The excitement of seeing a business grow as a result of my efforts and dedication was rewarding to say the least.
As I recognize good, sound entrepreneurship I began to wonder how many growers they needed to supply their market. Potential customers began to ask many questions about the reality of actual market demands and how it would affect their long-term success. PKIs response stated that they had captured a high-end pigeon market (refer to 3rd Paragraph) - creating a demand for many more family farm investments.
Having discussions with Arlan Galbraith, President of PKI, he reassured me that these customers existed, and my efforts to continue promoting family farm investments was in the best interest of the company.
By the 1st of February 2006, having continued discussions with Arlan, it occurred to me that his statement, I am in the business of selling breeders, reinforced my new found suspicions that this was his only business. You can imagine my disappointment.
Due to our family situation (losing our farm) I began to recognize I would not want to see other family farms in this position. It was then that I realized my sales pitch to the American family farm was fraudulent, to say the least.
Following my resignation in February 2006, Arlan attempted to verbally intimidate me with the possibility of a libel lawsuit, were I to speak out against PKI. Although I took his threat seriously at the time, I was later persuaded by several individuals to bring awareness to the public arena concerning the reality of PKIs schemes.
I can appreciate when one wants to expand his or her herd to capture a growing end-market. For example, a beef farmer facing a rising demand for products at the consumer level may need to sign-on contract farmers to meet that demand. In the case of this example there is a true end-market reflecting the reality of supply and demand.
In my opinion, PKIs supply and demand was only driven by the emergence of new family farm investors. The question was put forth to me, Bill, what if your neighbours were to invest in PKI and the company could no longer attract new investors? Since new investors are the only means of capital, this would result in a market crash, and your neighbours would lose their family farm. Would they not cry out, How come nobody warned or protected us?
Its time to speak out.
In a recent conversation, M.P. Michael Chong (Wellington-Halton) told me; I have asked [my staff] to refer this matter to the Provincial Attorney Generals Office and the Ministry of the Attorney General - as they are responsible for the enforcement of the law in Canada. I have also referred it to the Justice Ministers Office (Federally) and to the Provincial Authorities as well
to see if they are aware of the situation, and see if there is any need for action.
I have also obtained a copy of an email from the Fraud Branch of the Waterloo Regional Police dated January 30, 2008. The email states, Unfortunately the best weapon we have is public knowledge. Please let all your friends know about this (PKI). Although it is not a crime in Canada to operate this scheme it does not make it right. You may also want to complain to your member of parliament as to why it is allowed in Canada.
Also, as recently as March 28, 2008, Mr. Brent Homan (Assistant Deputy Commissioner of Competition. Prairies and Northern Region) replied to an email written by Andy Crim from Boone, Iowa. To make note, Iowa is the first state to recognize PKI as a Ponzi scheme. In his email, Mr. Homan responds by saying;
the Competition Act contains two specific sections which are relevant to your concerns. These sections of the Act are as follows
55.(1) Multi-Level Marketing Plan
and 55.1 (1) Scheme of pyramid selling
In his response, Mr. Homan did not sufficiently address Mr Crims concern. Further into his email, Mr. Homan mentioned, I have taken the liberty to forward your concerns to the Ontario Provincial Police Anti Rackets Section.
I am hoping the authorities will not continue to pass the buck and commit to resolving this matter.
As you can well imagine many Canadian and Provincial (Ontario) family farms are at risk. Either its time for the authorities to prove that PKI has a legitimate business, or its time for the authorities to end this matter once and for all.
Once you are able to contact the right individuals and investigate properly, could you please let me know what your opinion is and what information you were able to attain?
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