Wednesday, June 18, 2014

The Hayhow Trial - Day 2

Below is another report from Kitchener's The Record...thanks, Brian Caldwell, for continuing to report!

The extent of the Hayhow's expenditures, as outlined in the article, reminded me of something we families found out from the Trustee in Bankruptcy shortly after Imagine's bankruptcy, about how Sue Hayhow's extravagant lifestyle carried over into her work as the head of Imagine Adoption:  That when she travelled to Ethiopia to work with staff there and to spend time in orphanages, etc, she purchased first class/business class airfare at agency expense, and stayed at the most expensive, five-star hotel in Addis (in fact, my recollection is that she rented, often for weeks at a time, one of the private, three-floor villas on the hotel compound, complete with private swimming pool, gym, and butler service).  We visited that hotel for an hour or so when we were there, to exchange money and observe the hotel in all of its reputed splendour (it is an amazingly luxurious hotel and spectacular), but we were sickened when we saw that surrounding the hotel's compound was a massive wall; totally impoverished families made their homes using the exterior of that hotel wall as a wall of their home, to which they somehow attached pieces of plastic and canvas to provide shelter.  The juxtaposition of such squalor beside such grandeur was difficult to see.  Walking through the hotel gates was like walking from a barren dessert into an oasis of gold.  And this is where Sue Hayhow stayed when she traveled, at a cost of many thousands of dollars (compared to $40-60/night where the five of us stayed, including breakfast).  While she was being filmed caring for the poorest in the world, while she was being interviewed by television programs about Imagine's work there with the poorest of the poor, while children in the adoption agency's transition home were being fed one Mr. Noodle packet/day, she was provided for in the grandest of style and luxury in a walled compound.  And although the cost of these accommodations (often for weeks at a time while she was in Ethiopia) was likely a legit business expense, the utter inappropriateness of it speaks to the character of the husband-wife team currently on trial.

Anyway, the information that came out at trial today actually makes me feel physically ill.   Imagine Adoption took in millions of dollars from families waiting to adopt and in just 2.5 years, this is how some of it was spent.  I have few more words on the subject tonight.  


Here's the link to today's article:  Credit Card Charges at Imagine Adoption totalled $850,000

Have a read:

Credit charges at Imagine Adoption totalled $850,000

KITCHENER — A former couple who ran an international adoption agency charged about $850,000 to corporate credit cards in the 2 ½ years before it went bankrupt.
The expenses of Rick and Susan Hayhow were outlined at their fraud trial Wednesday by a forensic accountant who poured over financial records for police during an 18-month probe of Imagine Adoption.
Scott McBride could not say, however, if all the charges were for legitimate business purposes or not.
That left jurors with just a glimpse of the spending habits of the Hayhows, who broke up a few months before the nonprofit Cambridge agency collapsed five years ago.
Columns of figures projected on a screen in Kitchener court showed an agency card in the name of Rick Hayhow, the chief financial officer, racked up almost $500,000 in purchases from early 2007 to mid 2009.
Included were $57,000 for airfare, $40,000 for other travel expenses and $21,000 at restaurants.
The travel amount included $5,600 spent at a Disney Resort. Almost $2,000 was charged at the Air Canada Centre in Toronto, including $683 for seats for an unspecified event and $37 on souvenirs.
An agency card in the name of Susan Hayhow, the executive director, was used for just over $350,000 in purchases during the same period.
There were $100,000 in charges for airfares and $150,000 for other travel expenses, including $55,000 for hotels.
A charge of $13,000 was listed under Maple Leaf Sports, while purchases totalling more than $6,000 were made at high-end clothing store Holt Renfrew.
Crown prosecutor David Foulds went quickly over the credit card expenditures while questioning McBride, and jurors got virtually no explanation of them.
Other evidence showed the credit card bills were paid through various agency bank accounts, plus about $36,000 from personal accounts held by the Hayhows.
Rick Hayhow, 49, and Susan Hayhow, 48, pleaded not guilty to eight fraud counts involving hundreds of thousands of dollars in alleged personal expenses.
Six of the counts involve payments made with agency cheques for renovations at the couple's old stone home on Roseview Avenue in Cambridge and the purchase of a $3,000 horse.
Evidence on those counts Wednesday included an employee who testified the Hayhows paid $13,000 with an agency cheque for two fences and a backyard pergola.
The trial has heard two companies that renovated the house also did extensive work at Imagine's offices.
Defence lawyer Michael Lacy, who represents Susan Hayhow, has repeatedly suggested that his client directed the home improvements, while Rick Hayhow paid for them.
Lacy put it to one witness that Susan Hayhow was in Africa when the suspect agency cheque for fencing was made out.
An umbrella organization for three related agencies, Imagine grew rapidly and took in millions of dollars in fees from families hoping to adopt children from overseas, primarily Ethiopia.
As outlined by McBride, its finances were a confusing web of transfers between numerous bank accounts held by the three agencies.
The bankruptcy shocked more than 400 clients across the country who had spent up to $20,000 or more and were at various stages of the lengthy adoption process.
The trial is expected to last at least another week.


  1. I just cannot for the life of me figure out how they could think using company money for these expenditures would be alright? How is it possible that they plead not guilty? I cannot imagine ever thinking that spending clients money in this way is acceptable. I really hope they are truly held accountable. They appear to have lived lavishly on clients money and when the money ran out that was that. How can they live with themselves after what they have done?

    1. Yes, Tasha, I have struggled to understand the same thing and just can't grasp it. The only thing I've thought of is that it likely started small - maybe it started with a coffee bought on the company card because they forgot their money at home. After that something larger...and so on and so on. I really do think that once sin gets hold, it ensnares people and blinds them It seems, too, that they became very used to a very lavish lifestyle - when spending business money on the most expensive hotels in Addis, that would technically be a 'legit' business expense (though so very unwise and a misuse of company funds, IMHO) but perhaps that somehow accustomed them further to a luxurious lifestyle to the point where it became an expectation or sense of entitlement.

      I don't know about any of this...I've just grappled with the same questions as you and have wondered so often what could possibly have gone through their minds. I used to lie awake wondering these things and trying to put myself in their shoes to see what they might have been thinking.

      I do find it so interesting that Sue Hayhow's lawyer doesn't seem (at this point, anyway) to be defending the legitimacy of the expenses - instead, he's trying to blame it on Rick Hayhow. I find that almost a relief so far - though who knows what lengths they'll really go to yet..we're early in the trial. But even if she really was innocent and it was Rick's fault entirely (which I don't believe for a second), where on earth did she think that many hundreds of thousands of dollars were coming from to pay for all of those trips and renos and on and on. Even a huge joint salary of $320,000 will eventually come to an end!

      I didn't know until after the bankruptcy that the Hayhows had themselves declared personal bankruptcy, something like 8-9 years before the bankruptcy. I think I remember reading that they owed about $125,000 at the time. Where they got the money, a few years later, to buy the beautiful home that they bought is beyond me...that home sold for over $400,000 a few years after they bought it...where did they get the money from to purchase it...given their personal bankruptcy, I'm thinking that the banks wouldn't have been lending them the money for a mortgage???!!
      ANd what are they living off of right now...I'm not sure what Andrew Morrow is doing, but they both look pretty well put together.
      And who would hire Rick Hayhow in a book-keeping or financial capacity given the personal bankruptcy and the current legal charges??

      Anyway, more questions than anything...but this is how my brain goes sometimes!

      More coming, to be sure. Maybe we'll get a few of these questions answered yet, Tasha.


    2. just me's still early in the day and some of my grammar and punctuation is off in my comment above...sorry!


  2. I just finished reading a book 'Devil At My Heels' - the life & times of Louie Zamperini, a 1936 Olympian & POW/hero of WW II. It's going to be made into a movie (released in Dec this year, I believe), based on the book about him, 'Unbroken', by Laura Hillenbrand (who also wrote Seabiscuit). The point of me telling you this is that #1. What an amazing book - you have to read this! #2. Through God's grace, we are overcomers. 3. I really believe that it's only through God's grace & power that we can truly forgive. Resentment is a tiny seed that sprouts, gains a foothold in your heart, like ivy, is hard to rip out (again, like ivy), but leaves no room for God. I have so been there.

    We can be victims, we can be survivors, or we can be more - overcomers. Those who take advantage of the poor, the hurting, the downtrodden, the helpless - well, all I can say is that God is a God of justice. We have to leave it with Him and live our lives for Him moving forward, not looking back. He will take deal up justice with our enemies. Not the courts, not the justice system, not anyone else. Him. That should be a scary thought for the Hayhows.

    Notice that they had absolutely NO accountability structure set up in their organization. They obviously did not disclose their previous bankruptcy to their board, likely bought their home under a corporation.

    I used to work a bankruptcy desk for a corporation & did collections. (I did very well because I have the ability to think like the other side - someone trying to avoid paying their bills.) It's amazingly easy to work the system & avoid the questions & checks if you know how to do it. Obviously they did. Slap the label 'Christian' on it, & a certain demographic will trust you. Easy as that.

    I personally have an innate distrust of anyone who markets themselves/their company as 'Christian/ or 'honest' or 'full of integrity'. Actions speak louder than words - you shouldn't have to use this in your marketing to get clients.

    Anyhows, trust the Lord for justice for these 2 scoundrels. There won't be enough through the courts.


  3. Looks like it's a mistrial! I sadly cannot say I am surprised. It seems these two will never be brought to justice. It is unbelievable that they are likely going to get away with what they have done. There are just sometimes that justice isn't served and it appears this is one of them. I thank God that we have our children home and that this bankruptcy paved that path for us no matter how costly. However, I am a firm believer that people be held accountable and when that doesn't happy it just makes me sad. I have long moved on from the Hayhows but a part if me was deeply and forever changed by their actions. I will never trust so easily again. The sad part is that partially I feel like I should have known better and done better research. But I know no matter what I have long ago moved on from them. I guess now I just hope there is a new trial one day.