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Gerhard Baur seldom has visitors to his little factory in Alfred, a country village nestled halfway between Ottawa and Montreal, on the Ontario side of the river. So when a silver, late model Mercedes coupe turned onto his driveway, he wondered who could be calling.

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Mr. Baur makes guns. Restricted firearms, including semi-automatics. Pistols, military-grade assault rifles, sniper rifles, and more. Mr. Baur says he can make just about any weapon. “Send me into the bush with a Coke can and a screwdriver, and I’ll come back with a tank,” he boasts.

He has long dreamed of taking his five-year-old company, Canstar Arms Development Corporation, “to the next level.” He wants to replace his small production facility with a state-of-the-art weapons and ammunition manufacturing plant. He says he just needs a partner, a real player. He thought he might have landed one, that summer day in 2010.

The Mercedes stopped, and the driver stepped out. He looked all business. Suit and bow tie, expensive watch. He presented himself as a globe-trotting networker and corporate executive. “He was very charming,” recalls Mr. Baur. So began his unlikely, maddening relationship with Arthur T. Porter.