An Alberta man was recently convicted of fraud, impersonation and forgery in a scheme in which he solicited $1.7 million in investments from friends, neighbors and colleagues.
The business opportunities that Nickolas Donovan Ellis offered to those around him were “a house of cards built on a foundation of deception,” Justice of the Court of King’s Bench issued a decision on Jan. 17.
Ellis was found to have used his technical business knowledge and wanted to connect with the NHL to attract his victims, fake connections between teams to move business, and sometimes he sold the same interest to many people.
In total, he defrauded eight people between February 2016 and March 2019. Some victims invested in more than one business deal. Three victims lost approximately $200,000 or more.
“The evidence on many aspects of many of the cases was inconclusive, but the circumstantial evidence was overwhelming and in each case allowed only one plausible view,” wrote Judge John T. Henderson.
“None of the investment opportunities were real and all were designed to extract more money from the plaintiffs for the sole benefit of Mr. Ellis.”
FRIENDS, PARTNERS ARE VICTIMS
Ellis moved to Sherwood Park, east of Edmonton, in 2015.
In October, the court heard that Ellis has extensive business experience, including an advanced MBA from Queen’s University and a role in several mergers and acquisitions.
“Mr. Ellis was well respected by those he worked with, including the plaintiffs,” Henderson noted in his decision.
Ellis began working for Wainbee Canada Inc., a hydraulics business, in 2015 after moving to Sherwood Park. Two years later, he took up the position of general manager at Barcol Doors and Windows Ltd.
According to information presented in court, he connected with more than half of his victims through these activities. Other victims were neighbors and friends.
One man — who lost $194,000 investing in a non-existent program that Ellis promised Microsoft would buy — described Ellis as his “best friend.”
They all knew Ellis only “a short time” before they invested with him.
The app was the first and largest of Ellis’ five projects, with three people investing $1.189 million. One friend put up about $600,000 for the project; another about $400,000.
Ellis revealed that he was contacted by a software developer, whose last name he could not remember in court, who was collecting money for this application. Called “Royalty,” the app was advertised as a subscription service that would give customers access to professional athletes before and after games through interviews and broadcasts.
Although Mike Bossy, the retired New York Islanders winger, was not involved in the project, according to the agreed statement of facts, the three investors were introduced to him by Ellis at several events and received emails from someone who appeared to be Bossy.
Bossy didn’t have an email account. It was built shortly after the first dollars were invested in the project and became inactive after the final payments. Ellis declined to create an account.
Ellis’ phone number, however, was used to set up an email account whose user posed as an attorney involved with Dynasty. That email address was used to confirm money transfers and provide business updates, including a 2018 royalty value in the tens of millions of dollars.
No lawyer of that name has been found in Alberta or Ontario, where he is said to have come from. A combination of evidence led Henderson to believe that Ellis impersonated the legal team.
NHL JERSEY PROJECT
The second biggest plan was the idea of profit The NHL is replacing Reebok with Adidas as its jersey supplier in 2017.
According to Ellis, he was also contacted by a man whose full name he did not know but who was from the “collecting world” and was connected to Upper Deck. The plan was to buy some of the Reebok jerseys that were no longer in use, have them customized by the Edmonton company, and sell them again.
In two years, six people invested a total of $320,000.
Henderson found that Ellis sold the same interest to multiple groups and used non-disclosure agreements to keep them from getting anything.
He also concluded that Ellis had a fake email account purporting to be an Edmonton developer involved in the project, which was used to lend credibility to the deal.
Ellis previously had a private business with a company that made frames, he told the court that he spoke to the company about the Reebok jersey system. But, he is independent and never signed.
One victim, who went to Ellis with concerns about the settlement in 2018, received $21,000, or less than half of her total contribution.
14 ALL CHARGES
In all, Ellis was convicted of eight counts of fraud over $5,000, three counts of using or trafficking in a forged document, and three counts of identity fraud.
In another “hoax,” as Henderson called Ellis’ schemes, the fraudster said he was involved in a project with Upper Deck that involved licensing plans for Wayne Gretzky merchandise.
In one, Ellis talked to a golf friend about trying to acquire Barcol from its parent company.
Eventually, Ellis took the employee’s money for the real estate transaction, after telling him Oilers alumni Kevin Lowe and Craig MacTavish were among the others involved.
Ellis told the court that after receiving the money, he “gave it to the people it needed to go to.” But Henderson found that there was no evidence of that happening.
In the case of the Crown’s application, the judge wrote: “This scheme was carried out and resulted in the deposit of approximately $1.2 million into Mr. Ellis’s RBC bank accounts. These funds were used primarily to pay off Mr. Ellis’s other debt obligations. There is no money that was used to buy or sell any technology to Microsoft or anyone else.”
Some of Ellis’ victims became suspicious in 2018 and 2019, and eventually reported him to the police.
Police announced charges against Ellis in 2021.