Judge Issues Arrest Warrant for Quebec Cryptocurrency Business Owner in FACTOR Canada Cybertheft Case

There has been a major development in the FACTOR Canada cybertheft case.

The Ontario Superior Court of Justice has issued an arrest warrant for Quebec man James Campagna, found in contempt of court after nearly $10 million in music grant funds went missing.

In July 2024, it was reported that $9.8 million was allegedly stolen from the Canadian music non-profit and granting body’s Scotiabank account. In court last Friday (Jan. 9), where Billboard Canada was present, Justice W.D. Black of the Ontario Superior Court of Justice ruled that he will endorse a warrant for business owner James Campagna, sentencing him to 30 days in jail.

“I find that Mr. Campagna is a liar, a fraud, and a scofflaw, deliberately and knowingly breaching this court’s orders," wrote Justice Black in a bombshell Commercial List endorsement dated Jan. 9.

According to court documents, Campagna is the sole shareholder of Vipera, a Quebec-based tech company. The document claims that money was transferred in the form of a counterfeit invoice from FACTOR to Vipera’s Scotiabank account by Campagna, who moved the money into an account owned by cryptocurrency platform VirgoCX Direct.

The funds were transferred out mere days after the Department of Canadian Heritage deposited $14.3-million to distribute to the music industry.

After the case became public, FACTOR released a public statement, claiming that Campagna gained access to the bank account from an IP address that had never previously accessed their banking info. Additionally, the organization noted that it was never flagged about the “highly unusual, suspicious, and illegal activity” by Scotiabank.

The case is one of — if not the biggest — theft cases in the history of the Canadian music industry. Nearly two years into the legal battle, FACTOR’s lawyers have consistently requested that Campagna be held in contempt of court — now it’s finally happening, a rarity in the Commercial List court.

In Friday's filing, Justice Black writes that “Mr. Campagna has knowingly and intentionally disregarded and/or failed to comply with various orders of this court” including producing documents, correspondence, corporate financial statements and banking information.” Justice Black writes that Campagna has made various excuses to avoid participating, in what he calls "a frustrating 'the dog ate my homework' approach to his obligations."

“Mr. Campagna has lied about various aspects of his conduct and activities in relation to the fraudulent transfer,” he writes. “It is highly likely that he was a knowing and active participant in the fraud, and that he has benefitted and continues to benefit from the proceeds of that fraud.”

According to "FACTOR's investigations and surveillance," Campagna has now "fled jurisdiction," Justice Black reports, and moved to Qatar. That's according to evidence including social media posts indicating he plans to “stay and work in Qatar for a year" and documents that show his four children have been enrolled in school in the country.

In his endorsement, Justice Black recognizes that Campagna “has taken active steps with a view to putting himself beyond the reach of the court." Still, “there should therefore be plenty of time, once my order comes to his attention, within which Mr. Campagna can take steps to purge his contempt."

In a statement to Billboard Canada, FACTOR Canada CEO Meg Symsyk says the ruling is an important development as the organization pursues the repayment of the missing money.

"FACTOR welcomed Justice Black’s ruling this past Friday, which reaffirms what we maintained since the outset: the perpetrators of this theft have not been held to account,' she says. "The finding of contempt against Mr. James Campagna clearly illustrates the challenges that FACTOR has encountered in working to recover the stolen funds. FACTOR will continue to pursue all available legal avenues to recover these public monies and clear the organization and its staff."

Scotiabank tells Billboard Canada that they cannot comment, given that the matter is before the courts.

As the legal proceedings continue, the question of penalty and remedy remains open-ended. FACTOR has made its stance clear, as they hope to recoup the almost $10 million in lost funds. In addition to seeking contempt from Campagna, the non-profit is putting legal pressure on Scotiabank, which they said in 2024 has “participated reluctantly, and in the most limited fashion” during the initial investigations.

FACTOR has said that Scotiabank "has acknowledged it has never reported this financial crime to law enforcement" and that despite an issued money transfer of $9,772,875.33, over 300 times larger than any previously made from the account, there were "no alerts to FACTOR of this highly unusual, suspicious, and illegal activity."

FACTOR is one of the country's most significant investors in the development, financing and support of Canadian music. Many in the music industry have been watching this case carefully.