Lawyers Gone Bad by Philip Slayton

Author:Philip Slayton
Language: eng
Format: epub
Publisher: PENGUIN GROUP (CANADA)

ELEVEN

THE CRIMINALS PICK THEMSELVES

Richard Shead

Richard Shead was a prominent tax lawyer who helped a flamboyant con artist structure and execute a complex fraud that separated many ordinary people from their life savings. Shead gained little from the fraud—modest legal fees, and a bit of excitement along the way—and lost much, ending up disgraced and in prison. By all accounts, Shead was a cold, dull, and arrogant man. It was arrogance, his victims said, that made him do it: He thought he was smart enough to get away with anything.

IN THE SPRING OF 2002, I went to Winnipeg to see Richard Shead. He was a former law school gold medalist at the University of Manitoba. He had been managing partner of the leading Winnipeg law firm of Buchwald Asper Henteleff, and a bencher of the Law Society of Manitoba. He had chaired an advisory committee to the federal Minister of National Revenue, and for many years had been an active member of the local volunteer community. When I went to see him, he was a disbarred ex-convict.

Arriving downtown from the airport, I bumped into Gerry Posner, a lawyer friend, and in the course of casual conversation asked him about Shead. “One of the most brilliant lawyers Manitoba has ever seen,” Gerry said. “His firm was once a real powerhouse, back in the seventies. Izzy Asper, Gerry Schwartz, Jack London, Martin Freedman, Michael Nozick, Richard Shead—they were all partners in those days. They all went on to fame or notoriety.”1 Ingrid Chen, the infamous Winnipeg lawyer, told me some time later that she regarded Shead as “godlike.”2 Shead’s arrest in 1991 and later conviction for fraud was, as Marilyn Billinkoff, deputy CEO of the Law Society of Manitoba, put it, a “huge deal, a fall from grace.”3

How did a leading lawyer become a penitentiary inmate? It was simple enough. Shead helped a client, Norman Bruce McLeod (known as “Bruce”), defraud people of their life savings in phony real estate transactions. The Financial Post, in a February 1, 1996, article about Canada’s biggest white-collar criminals, summed up Bruce McLeod’s scam:4

Calling himself a developer, McLeod would approach a “client” with an offer of equity in an apartment or office building he owned. A charming and persuasive personality, he was a gifted salesman who used his skills to rope in hundreds of buyers. Typically, when the deal was done, McLeod ended up with far more money in his pocket that the property was actually worth.

The Manitoba Court of Appeal gave a description of McLeod’s technique in the 1993 case of Skimming v. Goldberg.5 Hugh and Donna Skimming put a second mortgage on their house so they could invest in a Bruce McLeod transaction, lost everything, and sued the mortgagee to have the mortgage set aside (they failed, because it was McLeod’s fault they lost their money, and not that of the mortgagee). Mr. Justice Monnin referred to the lawsuit as “the final act of the tragedy authored by the snake oil salesman.” He described how

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