Former AMA executive gets prison time for $8-million fraud

A former Alberta Motor Association vice-president was sentenced to five years in prison Monday after admitting to an $8-million fraud against the organization.

James Alan Gladden, 38, pleaded guilty to one count of fraud over $5,000 in January, admitting to authorizing millions of dollars in invoices being paid that were ultimately funneled back to him for his own business expenses and personal use.

According to an agreed statement of facts entered with the court, Gladden altered or falsified 55 invoices between Jan. 8, 2013, and June 16, 2016, while working first as a director and later vice-president of information technology for the AMA.

The AMA is a not-for-profit corporation that advocates for driver safety and sells various types of insurance and travel services.

Court heard that Gladden’s position allowed him to approve the fraudulent invoices because at the time, internal practices allowed invoices to be paid once they were signed by a single employee with sufficient authority.

In some cases, Gladden had the AMA pay for services and goods for his personal companies, while in others, he made up invoices for work that was never done. He used an online money transfer company based in San Francisco to pay fake vendors through transfers made with his AMA email address, and would then move the money into his personal accounts.

He was fired in July 2016.

That same month, the AMA commenced legal action against Gladden, but has since reached a settlement that allowed it to recover about $3 million, a court heard Monday. The organization said the remaining amount was covered by insurance.

As part of the agreement, Gladden signed over a property in Arizona, a 2015 Jeep Cherokee, a Kawasaki ATV, watches and a travel trailer, and did not resist AMA seizing and liquidating his RRSP accounts. According to the agreed statement of facts, the company also has or expects to recover funds through the seizure of a downtown Edmonton office building, Gladden’s Edmonton home, a Porsche, a BMW and other assets.

In a brief statement posted to its website Monday, AMA said it fully co-operated with the police investigation into Gladden.

“We’re pleased to learn he pleaded guilty and was sentenced appropriately,” the statement reads. “In light of this case, AMA reviewed its processes and put additional controls in place.”

The AMA declined to comment further via email.

Court heard Monday that Gladden began suffering from depression in 2014, and was unwell for much of the time he was committing the fraud.

After he was arrested and charged, he was diagnosed with a major depressive disorder.

But provincial court Judge Larry Anderson said he didn’t find depression was what drove Gladden to commit the fraud, and so he sided with Crown prosecutor Damian Rogers’ submission on sentencing.

“At the end of the day, he was driven by a desire to take money that did not belong to him,” the judge said.

Speaking outside the courthouse after the decision, defence lawyer Brian Beresh, who had argued for a sentence of three years, said he thinks the evidence showed a causal link between his client’s illness and the offence.

“It wasn’t someone simply doing it out of greed. There were a number of factors, including the death of two close family members,” Beresh said.

Gladden’s parents attended the hearing to support him.

Read the full story over at the Edmonton Journal.

This story was summarized by Canadian Fraud News Inc.

Devin Jones is the head writer and social media producer at Canadian Fraud News. Devin was raised in Toronto and is a graduate of the Ryerson University journalism program. As a former Digital Media editor at the Ryerson Review of Journalism, you can find Devin camera and coffee in hand, at his home photo studio.

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