Armed with a mechanical engineering degree in Turkey, he came to McGill University on a scholarship in 1984 and earned his PhD. From 1992 to 2001, Kalaycioglu worked for the Canadian Space Agency (CSA) in the space shuttle’s Canadarm2 program.
Then in what his friends and colleagues would all insist was completely out of character, the accomplished, well-respected space engineer got enmeshed in an elaborate financial fraud that ended with an FBI sting.
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With no training or experience, Kalaycioglu launched a finance company in 2000 and became involved with a Florida-based investment company and its bank in Grenada. Kalaycioglu would later be convicted of defrauding residents of Broward and Palm Beach counties in Florida on the basis of false representations, including that he was one of only seven traders in the world approved and licensed by the U.S. Federal Reserve to trade in bank instruments that yielded a very high rate of return.
He also told potential investors their deposits were insured and owners of the bank in Grenada included Citibank and UBS – none of which was true.
“Dr. Kalaycioglu believed them to be true, but he did not conduct any due diligence to verify the accuracy of his representations,” the tribunal noted. “Dr. Kalaycioglu appears to have been wilfully blind to the badges of fraud.”
A U.S. appeal court had a less sympathetic assessment, finding Kalaycioglu “claimed to be engaged in investment trading for the Canadian government and to have a mandate from the United States Federal Reserve and World Bank to invest in certain humanitarian programs. To support his claimed connections, Kalaycioglu often flashed his Canadian Space Agency identification and an American Express card issued to him by the Canadian government.”
Federal prosecutors would allege that duped depositors lost $20 million.
After the FBI got wind of the fraud, they set up a sting codenamed “Bermuda Short.” Posing as corrupt managers of a mutual fund, they caught Kalaycioglu on tape offering to pay their undercover agents $10 million in kickbacks in exchange for the fund buying $40 million in certificates of deposit from the bank in Grenada.
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In 2004, a Florida jury convicted him of 11 counts of wire fraud and one of conspiracy to commit wire fraud. During his 16 1/2 years behind bars, the tribunal heard the remorseful Kalaycioglu helped fellow inmates earn their high school diplomas while attaining his MBA and two law degrees.
In 2019, he was transferred here and released on full parole that expires in 2027. He’s resumed his robotics engineering career as a research fellow at Toronto Metropolitan University and as director of space and robotics programs at Dr. Robot Inc.
He also completed his masters at Osgoode Hall Law School and articled at an international firm in Turkey. But with a criminal record, he would need to be found of “good character” to qualify to practise by the Law Society of Ontario.
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The law society said Kalaycioglu should have to wait until his parole ends in three years. The tribunal disagreed, finding he can practise now but must disclose his past to employers or if self-employed to potential clients.
“Over 20 years ago, Dr. Kalaycioglu made serious errors in judgment,” the panel concluded. “Dr. Kalaycioglu is no longer the same person he was at that time. He has accepted responsibility for his wrongdoing and fully rehabilitated himself and set himself firmly on a path of redemption and public service.”
A spokesperson for the law society said they won’t appeal the tribunal decision.
mmandel@postmedia.com
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