Two Calgary men have been found guilty in the Koocanusa Fraud Case of taking millions from individuals seeking to purchase vacation properties at Lake Koocanusa. The case, which was ruled on by Justice R.E. Nation of the Alberta Court of King’s Bench, saw Craig McMorran convicted of fraud, money laundering, and theft of a cottage from its rightful owners.
McMorran was working on a development project called Sweetwater Resort at Lake Koocanusa. He acquired shares in Marcer Ranching Ltd., which owned a 296-acre property. This land was subdivided into development lots referred to as the “lower,” “middle,” and “upper terrace lands.”
By 2012, Marcer Ranching Ltd. was charging RV owners to place their vehicles in an existing campground on the property. However, by 2014, foreclosure proceedings had begun against Marcer for unsold and unsubdivided lands, primarily in the lakeside area.
Despite the foreclosure, McMorran continued selling unsubdivided lots on 50-year leases, promising buyers the option to purchase once the subdivision was complete. Seventeen victims testified that they were misled into signing contracts for either cabin or RV lots. They were assured that water, power, and sewage services would soon be installed, but these promises were never fulfilled.
Following the foreclosure, the new owner of the property denied access to anyone who had signed leases with McMorran and his associate, Kosta (Gus Kalabalikis), leaving many without the properties they believed they had purchased.
Justice Nation ruled that McMorran’s actions were fraudulent, noting that he continued to market and sell properties even though Marcer did not have the legal right to do so. McMorran’s claim that buyers were aware of the foreclosure was dismissed as baseless.
Kosta, McMorran’s employee, was found guilty of fraud for his role in facilitating sales while knowing the project’s financial instability. The court heard that Kosta continued to process sales even after learning about the foreclosure, diverting funds to himself and failing to inform buyers of the risks.
Additionally, McMorran was found guilty of stealing a cottage owned by Gwen and Wayne Yager, shareholders in Marcer Ranching Ltd. The Yagers had purchased a prefabricated home intended for Sweetwater Resort. When they returned to their lot in 2016, they discovered the cottage was missing. Testimony revealed that McMorran sold the Yagers’ home to another buyer without their knowledge or consent.
The fraudulent scheme affected over 85 individuals, resulting in financial losses exceeding $2 million. Justice Nation highlighted that McMorran’s conduct was dishonest and deceptive, causing significant harm to those who trusted him.
This ruling marks a significant step towards justice for those defrauded in the Sweetwater Resort development, bringing to light the importance of transparency and integrity in property dealings.
Source: CTV News
