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No Restitution for the Queen in Aussie's Biodiesel Fraud Case

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By Casey C. Sullivan, Esq. on May 13, 2015 3:58 PM

Her Royal Highness isn't entitled to any restitution from an Australian criminal who bilked the U.S. and Canada out of millions in a fraudulent biodiesel scheme. Nathan "Nati" Stoliar has been described by The Australian as a "Forrest Gump-style character" of Down Under's "corporate sleaze set." Last year, he pled guilty to defrauding the U.S. government, forfeited $4 million and agreed to pay $1 million in restitution. Stoliar, whose name should have given him away, could face up to 69 years in prison and an additional $2 million in fines.

And the Queen wants her share. Since Canada was also a victim of Stoliar's, the Canadian Department of Justice, in Her name, sought restitution in federal court for a little over $1 million (Canadian). Unfortunately, Stoliar's scams were too separate to entitle Canada to restitution for his U.S. crimes, the Ninth Circuit ruled on Tuesday.

Scammed Yankees, Scammed Canucks

According to the U.S. Department of Justice, Stoliar and his accomplice fraudulently generated and sold U.S. biodiesel credits. The scheme allegedly made Stoliar almost $37 million in the United States. At the same time, Stoliar pursued a parallel scam in Canada, fraudulently gaining Canadian biofuel subsidies worth about $1 million.

Stoliar was not arrested or prosecuted in Canada, however. Instead, the Canadian government sought restitution after he plead guilty in the U.S. (Sadly, neither Queen Elizabeth, nor her Corgis, nor her many royal hats, were actually involved in the litigation. Rather, the monarch, as Canada's head of state, stood for the Canadian government, in much the same way that "The People" are often captioned in criminal proceedings.)

Similar, But Not the Same, Crimes

Under the Mandatory Victims Restitution Act, victims of fraud are entitled to restitution when they can prove their loss by a preponderance of the evidence. Even if the victim was harmed by activity that was uncharged, a victim can still recover if that harm was closely related to the illegal scheme.

The harm that befell our neighbors up north was insufficiently related to the U.S. scheme, however, the Ninth held. While both countries were victims of Stoliar's cons, the fraudulent Canadian subsidies had little to do with the U.S. scheme that lead to Stoliar's prosecution. The lie at the heart of each scheme was the same -- Stoliar's misrepresentations about how much biofuel he was producing -- but the actual victims, incentives and means were different. Thus they could not be part of the same "scheme, conspiracy or pattern" needed for restitution.

Currently, there is no word on whether the Queen will appeal to the Supreme Court.

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