Canada police charge 6 with fraud in Norbourg case

Wed Jun 18, 2008 1:00pm EDT
 
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TORONTO (Reuters) - Police in Montreal have arrested and charged six people with hundreds of fraud-related counts for their roles in the 2005 collapse of the Norbourg investment company, a spokeswoman for the Royal Canadian Mounted Police said on Wednesday.

Norbourg Asset Management's assets were frozen by the Quebec provincial securities watchdog in August 2005 amid fraud allegations.

When the company collapsed it left about 9,200 investors short of C$130 million ($127 million) in total.

Among those charged by the RCMP is former Chief Executive Vincent Lacroix, who is already in jail serving a 12 year sentence for various securities convictions.

Lacroix's trial was conducted under Quebec's penal code, which is different from Canada's national criminal code. The judge in that trial heard that many Norbourg victims lost their life savings.

In addition to Lacroix, the RCMP arrested five others -- Felicien Souka, Serge Beugre, Jean Cholette, Remi Deschambault and Jean Renaud. Collectively the six face 922 charges for alleged fraud conducted between 2002 and 2005, an RCMP spokeswoman said.

Ernst & Young, which was appointed the provisional administrator for Norbourg in 2005, said at the time that the fund manager's financial statements showed C$205 million in assets under management, but only C$75 million could be accounted for.

($1=$1.02 Canadian)

(Reporting by Lynne Olver; editing by Rob Wilson)