10/24/2012 04:00 EDT | Updated 12/23/2012 05:12 EST

Disgraced theatre mogul Drabinsky granted day parole in Toronto halfway house

KINGSTON, Ont. - Garth Drabinsky's world used to include the who's who of Broadway and Hollywood, but on Wednesday, the disgraced theatre impresario told a parole hearing he's more than ready to move on to the next scene in his life.

A two-member panel with the Parole Board of Canada agreed, and granted day parole to the 62-year-old for the remainder of his five-year fraud sentence.

The board members determined that the former entertainment mogul would not pose an "undue risk" to public safety if he were to be released to a halfway house in Toronto, but denied him full release, calling that "premature."

"Thank you from the bottom of my heart," said Drabinsky, crying and hugging his family as he heard the decision.

The ex-CEO of the now-defunct Livent Inc. _ the company behind such hits as "Phantom of the Opera" and "Ragtime" _ testified in front of the board for nearly three hours via video link from the minimum-security Beaver Creek Institution in Gravenhurst, Ont.

During the hearing, Drabinsky faced a myriad of probing and confrontational questions on his guilt, his remorse and his plan post-release.

In 2009, Drabinsky and his longtime friend and business partner Myron Gottlieb were convicted of two counts of fraud each for a book-cooking scheme that ultimately resulted in the demise of Livent.

The court ruled that the partners orchestrated a scheme involving the falsification of Livent's financial statements to lower its expenses and make the company look like it was meeting high earnings projections.

At Wednesday's hearing, in his first public statements since Livent's collapse 14 years ago, Drabinsky repeatedly denied that he intentionally committed fraud or that it occurred out of greed.

However, he admitted that he had pressured employees to maximize profits at the company, and ultimately, he was responsible due to his "gross negligence."

"I drove people tremendously hard in the company," he said. "I drove them to succeed through my flawed ambition and creative hunger, which was not grounded in greed. I pushed the envelope too far."

He said he did not know that what was being done by the company's accountants "crossed into criminality."

Drabinsky said he had suspected in 1997 that there were inaccuracies in the company's financial statements but due to his lack of knowledge of accounting and computer practices, he "walked away from the details." It's believed the fraud can be dated back to 1989.

"I should never have been CEO of the company," he said. "That was a mistake."

The bankruptcy of the publicly-traded company ultimately cost investors an estimated $500 million.

At its height, Drabinsky told the panel that stocks were trading for $16 per share, making his own personal net worth at the time close to $50 million.

Last September, after losing a joint appeal of their convictions, Drabinsky was sentenced to five years in prison and Gottlieb to four years.

He told the panel Wednesday that the first month of his sentence, which was served at the maximum-security Millhaven penitentiary in Kingston, Ont., was "devastating" to him and his family.

"It affected me beyond description," said Drabinsky. "Every time the lead door slammed shut and reverberated I was overwhelmed."

Drabinsky, who considers Oscar-nominated actor Christopher Plummer and Canadian ballerina Karen Kain his close friends, said he soon found himself "face-to-face with a different world."

He recalled exchanging words with Gottlieb through "thin cracks in the cell door" because they had been kept apart while incarcerated there. But when the two were moved to Beaver Creek in December 2011, they spent nine hours together in a transport truck picking up and dropping off passengers in prisons all across Ontario.

When asked what the two business partners talked about, he said they showed a continued "genuine love and affection" for each other.

"The exchange was that it had to get better than what we went through," said Drabinsky, who appeared thin in a green sweater.

He sobbed when he told the board that he was contacted last August by the Governor-General's office about stripping him of his Order of Canada, awarded in 1995 for his contribution to the arts.

"I've always given everything I had to this country," said Drabinsky, noting that he had often resisted temptation to move the company to the U.S.

The panel imposed several conditions on his six-month-long release to the halfway house, including barring him from owning or operating any business, becoming self-employed and managing financials at any company or organization.

Drabinsky must also submit financial and banking statements to a parole officer at least once a month, and not associate with any convicted criminals, including Gottlieb.

Once granted parole, the man who used to rub shoulders with Hollywood elite said he wants to keep a "low profile" and continue producing movies and stage productions.

He was also in talks about doing consultant work, and lecturing at a business school and an arts school. Drabinsky said he remains passionate about the entertainment industry but has learned through his commitment to Judaism that he needs to take on less and focus on his family.

"Forget about building any empires anymore," said Drabinsky. "I already did that."

Drabinsky said he no longer has his fortune, and will be supported by his brother until he can get back on his feet.

He will be moved to the halfway house sometime after Nov. 11. Six months after that, he may reapply for full parole. His sentence ends in September 2016.

The parole board moved Gottlieb to a halfway house last July.