Former CEO, lawyer in Knowledge House stock fraud case granted bail
Daniel Potter and Blois Colpitts were sentenced to prison terms on Wednesday
Two of Nova Scotia's most notorious white-collar criminals have been granted bail as they appeal their convictions in the blockbuster Knowledge House fraud case.
Daniel Potter, the 66-year-old former CEO of the defunct tech firm, was sentenced Wednesday to five years in prison, while the company's 55-year-old former lawyer, Blois Colpitts, was sentenced to 4½ years.
On Thursday, Nova Scotia Court of Appeal Justice Cindy Bourgeois said she was satisfied neither man was a flight risk, and that their appeals were substantial.
Both men surrendered their passports and posted a $100,000 surety each.
The disgraced executives, found guilty in March of conspiracy to manipulate the firm's share price and carrying out fraudulent activities in a regulated securities market, have appealed their conviction.
The co-conspirators used multiple manipulative techniques to prop up the firm's share price.
Though the Crown had estimated the fraud was about $86 million, Nova Scotia Supreme Court Justice Kevin Coady said Wednesday he would not put a specific dollar figure on the scheme, instead calling it a "large scale multimillion-dollar fraud."
Knowledge House, the once high-flying Halifax technology darling, developed software the company promised would revolutionize the elementary, high school and post-secondary education systems.
The appeal is set for Sept. 16 to 20, 2019, with three days the following week just in case. The Crown has also indicated it will be filing a cross-appeal.
Both men will have to turn themselves in to jail the day before the court's decision on appeal is announced, to avoid them fleeing if the appeal is dismissed.
The appeal poses unique challenges because of the volume of material. The trial transcript alone is 22,000 pages.
Both the Crown and defence agreed it would need five days, whereas most appeals are a day or less.
With files from Canadian Press