CHAPTER 4: Trying to Take Care of Business
Maxine Patrick, the Kamloops Blazers’ long-time office manager, was gone. Hundreds of thousands of dollars were missing.
Colin Day, who had been the WHL team’s president for the previous 17 years, had been forced to resign.
It had been eight years since the Blazers had won their third Memorial Cup in four years – it may as well have been a million years.
For years, the song Takin’ Care of Business would be played after Blazers’ goals and home-ice victories. The Blazers now were raising eyebrows, not championship trophies. All over the world of hockey, people wanted to know who hadn’t been takin’ care of business.
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The restructuring of the Kamloops Blazers Sports Society began in earnest on Nov. 17, 2003, with what turned out to be the first half of its annual general meeting. The meeting, which was closed to the media, was highlighted by the election of officers.
When the meeting finally ended after almost five hours, Case van Diemen was the president. Gary Cooper had returned to the board after a lengthy absence and was the vice-president. Norm Daley, an accountant and the major push behind the birth of the Strauss Canada Cup of Curling, was the secretary. Dennis Coates, a lawyer with Mair Jensen Blair, was the treasurer. Elected as directors were Ross Jardine, Ron Maguire, Tom Mangan, Frank Rossi and Bob Smillie. Only van Diemen and Rossi had served on Day’s final board.
Gone from the previous board were Andy Clovechok, who had been Day’s vice-president, Rick Harris, Loy Hoffbeck, Red McRae, Norio Sakaki and Ted Smigielski.
“We’re going to begin to put together some committees to help the organization,” van Diemen said, explaining that the Blazers’ board had never before included committees.
Rossi added: “Max (Patrick) did all the cheques by hand. Now they’re all computerized. We’re also changing signing control of the cheques.”
Now, instead of the president and office manager having signing authority, the signatures of the general manager and at least two directors were required on each cheque.
“We’re starting with a bunch of new people, which is fine,” offered Mike Moore, the general manager. “It’s time to start the process of getting things going and in a new direction.”
Yes, the winds of change were blowing. Soon, Moore would feel the breeze.
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What would become an exodus of employees began in January 2004, a short time after the board hired Gerry Bell to take a look inside the organization, and Moore was the first one out the door. Bell, from Western Industrial Relations Services Ltd., had begun interviewing employees on Dec. 24.
“We wanted to get a feel, an independent review of what our situation is,” van Diemen explained, adding that it was too early to tell whether a whole reorganization was in order.
One day later, on Jan. 11, 2004, the Blazers severed ties with Moore, their general manager since June 8, 1998. Moore, whose contract was to run through the 2004-05 season, received an immediate settlement that paid out his contract.
Dean Clark, who had been introduced as the team’s head coach in May of 2003,
was named interim director of hockey operations as the team, for the first time in its history, separated its hockey side from its business side. Clark would look after the former; the board of directors, under van Diemen and with input from business manager Angie Mercuri, would handle the latter.
Over the next two years, the Blazers would terminate Don Larsen, their longtime director of sales; Kym Fowles, their box office manager; Melinda Gouschuk, the manager of their souvenir shop; and, Doug McLeod, who was responsible for, among other things, some souvenir inventory and real-time scoring during games.
Fowles would be in a Kamloops courtroom in August 2006 to witness Patrick’s sentencing hearing. "It's been a long two years," she said. "I had to be here."
On the ice, the Blazers faltered, making two midseason coaching changes and, finally, failing to make the playoffs in 2005-06, the first time that had happened in the franchise¹s history.
The arena, once filled to the brim with excited fans, was half empty on many nights.
Today, season-ticket sales, once at 4,800, are around 3,500.
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The extent of the misappropriation of funds began to surface on Jan. 22, 2004, when the Blazers held the second half of their annual meeting. For the first time, The Daily News was reporting that the loss was likely to be “well over $1 million.”
At a news conference on Sept. 24, 2004, the Blazers and KPMG supplied information that revealed the overall figure had grown to $1,079,714.
“I think,” Coates said, “the total range of the defalcation is conservatively somewhere between $1.1 million and $1.3 million.”
Coates also revealed that the Blazers had spent $140,000 “chasing this” and had yet to recover even one penny. “It’s hard to believe that amount of money could evaporate,” he said, adding that $85,000 was paid to Davis and Co., a Vancouver-based law firm.
“Davis and Co., before we quit going down that road, spent a fair amount of time accessing (Patrick’s) Visa records and trying to find if there were special lump sums paid or travel down to wherever her husband’s log company is, somewhere in the States . . . but they didn’t come up with anything. . . . So far, zero.”
Van Diemen added: “Davis and Co. also had frozen a lot of her bank accounts, accessed her bank accounts, and found nothing.”
Coates also told that news conference that “the activity seems to have started after Bob Brown’s departure from control of the Blazers hockey club.”
Brown, the team’s general manager, had been fired by Day on June 5, 1995, just 22 days after the Blazers had won their third Memorial Cup in four years.
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Patrick was charged with fraud and theft over $5,000 on Sept. 27, 2005. For purposes of those charges, the Crown and defence agreed that the fraud began in 1994 and that it totaled $989,647.46.
At her sentencing hearing on Aug. 25, 2006, in front of Justice Daphne Smith, crown prosecutor Joel Gold outlined the simplicity with which Patrick took the money. She simply wrote cheques payable to herself, recording them as lower amounts in the ledgers for which she had complete responsibility. Gold told the court how, in one instance, Patrick wrote a cheque to herself for $2,300 and recorded it in the ledger for $300.
At the sentencing hearing, it was disclosed that Patrick, 48, was in the process of divorcing her husband, Charlie. The two had sold their home and come up with $150,000 to settle a civil suit the Blazers had filed against them.
She now was living in a rented condo in Williams Lake and working – two weeks in, one week out – for a catering company at a mining camp in northern B.C. She had been, she said, sober since the first week of March.
In court, her tale came out as a sordid web of alcohol, drugs and adultery; her husband, she said, had been having an affair with her best friend. However, court was told that she hadn’t started using cocaine until 2001, at least seven years after she had begun taking money from her employer.
Court was told that her husband began using cocaine in 1983, sometimes freebasing "for three or four days straight." With a husband who was "severely addicted" and who would go into rehab "about 1991," defence lawyer Peter Jensen said, Patrick was "continually" borrowing, consolidating and remortgaging their home in an attempt to keep their finances above water.
In 1996, her husband started a log home business – "He wasn't a good businessman," Jensen told the court – and by 2001 their marriage was falling apart. The Patricks have two daughters in their 20s.
In 2001, Jensen said, Maxine began using cocaine. She also lost her father, stepfather and brother, and her mother was diagnosed with breast cancer, in about a two-month period that summer. On top of all that, Jensen told the court, Patrick discovered that her husband was having an affair with "one of her best friends."
However, as Gold pointed out, the offence with which Patrick was charged began "much earlier" than 2001. During the 1994-95 fiscal year, Patrick stole $6,200. In 2002-03, she took more than $262,000.
Patrick would, Jensen said, numb herself with cocaine and alcohol. There were times, he told the court, when she was in a "drug-induced haze."
"Her life spiralled out of control; she lived in a drug-induced haze," Jensen said.
After the fraud was discovered in September 2003, Jensen said: "Ashamed and guilt ridden, she shut the world out and she lived in the black hole drugs had put her into. She felt shame, remorse, guilt and embarrassment and she just took more and more drugs."
Gold told the court that the Crown's case file contained "no indication" that Patrick's drug use was in evidence to "anyone with whom she worked."
In his submission, Gold noted that the Blazers, through the Kamloops Blazers Sports Foundation, funneled money back into the community through grants to various sporting and cultural groups, teams and organizations. The fraud, he said, meant that those groups also were shortchanged.
"(The victims) are not just the Blazers, nor the Blazers' shareholders – it's the whole community," Gold said. "What is more disturbing here is (the fraud) has deprived the area and city of significant funds available for other projects."
Van Diemen, the Blazers’ president, was in the courtroom as a victim-impact statement he had prepared was entered into the record. The team, van Diemen wrote, had suffered serious financial harm and, for the first time in its history, had had to get a line of credit.
Patrick, in a letter to Justice Smith that was read in court by Jensen, expressed remorse.
"The remorse is so overwhelming, I just go numb," the letter read. "Stupid people do stupid things and desperate people do desperate things. Chalk me up as both of those things for a while in my life."
However, she added, “I am not in need of rehabilitation,” because of “the hell I put my family through. . . . I refuse to go down that road again.”
“I am,” she wrote, “so, so sorry for what I have done.”
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Following the sentencing hearing, Charlie Patrick, at that point still Maxine’s husband, told Kamloops television station CFJC that he didn’t see any of this coming.
“I’m guilty of not tending to the banking end of it,” he said. “I mean, I just left everything in her hands. I never once questioned how much money she made.”
He also took issue with her claims of his drug use and adultery, saying: “That’s a blatant lie and it shouldn’t be allowed.”
Charlie Patrick added: “There was cocaine in our life prior . . . towards the end she got into a real shell and would not come out.”
He also claimed that Maxine had yet to take responsibility for what she had done.
“She has made it up in her mind,” he said, “that somebody else is to blame in all of this. There is nobody else to blame. You can only blame yourself for stuff like that.”
Despite all that his wife had put him through, despite the fact that he said his reputation in the community was damaged by all of this – he claimed people would look at him and say, “ ‘Oh, you’re Patrick . . . you’re a thief.’ I ain’t a thief.” – there was at least a part of his heart that was really hurting.
“I’m not gonna be happy if she goes to jail,” he said. “I mean, there’s still feelings and that’s the mother to my children. It’s gonna be terrible. But until she faces up to it I think that’s where she should go . . . to face up to what she has done.
“She has yet to apologize to the Kamloops Blazers or the town of Kamloops or her family for what she has done.”
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On Aug. 22, 2006, at 9 a.m., Maxine Patrick, 48, who one week earlier had pleaded
guilty to one count of fraud, was sentenced in B.C. Supreme Court by Justice Smith to 3 1/2 years in jail.
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On Aug. 22, 2006, at 9 a.m., the Kamloops Blazers’ finance committee was meeting with representatives of KPMG. They were going over an audit of the financial statement for the fiscal year that ended May 31, 2006.
Prior to Sept. 11, 2003, it had been a long time, perhaps since the late-1980s, since the Blazers’ books had been subjected to an audit. Day, the long-time president, had deemed them to be too costly.
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On March 7, 2007, Charlie Patrick appeared in a Kamloops courtroom and pleaded guilty to two counts of failing to file income tax returns. He was fined $2,000 and ordered to file the returns.
Defence lawyer Kris Jensen told provincial court judge Tony Dohm that his client had left all of his financial affairs in his wife’s hands. Charlie Patrick, it seems, wasn’t aware that his wife hadn’t filed the tax returns.
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On April 6, 2007, the Kamloops Daily News reported that “the Kamloops Blazers’ former business manager . . . is out of prison on day parole.”
Maxine Patrick had attended a Feb. 23 parole hearing after which the National Parole Board had released her on day parole.
Evelyn Blair, a spokesperson for the parole service, told the newspaper that Patrick would be required to live at a halfway house and abide by nightly curfews. Patrick was eligible for full parole in October.
The newspaper reported that “terms of Patrick’s parole require (her) to stay away from intoxicants of all kinds and make full disclosure of her personal financial situation if her parole officer demands it.”
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None of the money – $989,647.46 – that disappeared has been located.
NEXT (Jan. 28): The Road to Privatization
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