Thank you, Mr. Chairman.
Members of the committee, I am here to represent the 1,600 victims of the Mount Real scandal, which was exposed in 2005. We lost a total of $130 million. Many victims lost their entire life's savings. They had to return to the workforce in their 60s and 70s, their dreams of a comfortable retirement shattered. Many suffered serious health problems, both psychological and physical. It is believed that at least one victim committed suicide.
Our victims, along with those of Earl Jones, Norbourg, and Norshield, have been lobbying vigorously for the federal government to crack down on white collar criminals. We wish to thank Mr. Harper and his government for listening to us and for bringing forth this new bill.
The Mount Real case has not received the media attention of other major fraud cases in Quebec. We are the forgotten victims. Mount Real is alleged by Quebec's l'Autorité des marchés financiers, or the AMF, to be a massive Ponzi scheme involving 120 different associated and subsidiary companies. All the aggravating factors included in this new bill would certainly apply in the case of Mount Real: the duration of the alleged fraud, the complexity of the fraud, and the significant impact of the fraud on its victims.
We are not only confronted with devastating financial loss, but with great injustice as well. Criminal charges have yet to be laid against the principals of Mount Real. We feel betrayed by the RCMP, who told us that the case was too complicated and that they lacked the money and manpower to investigate. They strongly suggested that the trustee for Mount Real prove that a crime had been committed before they would take possession of the file.
Something has to be done to make sure that we have the resources to investigate and prosecute white collar criminals. In a recent Financial Post article, James Grout of Thornton Grout Finnigan says that one reason Canada is fourth on the list of countries where fraud is prevalent is the lack of deterrence. “We don't put anyone in jail”, he said.
It is imperative that these criminals be exposed and prosecuted as quickly as possible. Since 2005, the principals of Mount Real have had ample time to transfer and hide their assets. The AMF has only laid penal charges against them. They have been free to live their lives, even leave the country, passports in hand. The trustee for Mount Real has recovered about $4 million, most of which has gone to pay the trustee's and lawyers' fees. There will be no money left for the victims of this scandal.
We feel betrayed by the AMF. We realize that as investors we have a responsibility to do our homework, to know and understand what we are investing in and who we are dealing with. In our case, we did everything by the book. Our financial advisers and iForum, the brokerage company they worked for, were duly registered with their professional associations and the AMF. We trusted that these financial watchdogs would do their job to protect us. Our investments were in promissory notes, which our brokers assured us were guaranteed.
The AMF actually investigated Mount Real a few years before its collapse in 2005 and found nothing wrong. We made claims to the victims compensation fund, but were refused on the basis that the fund did not cover our particular type of investment. Banks offer insurance up to $100,000. The government should consider a similar type of insurance to protect investors from becoming victims of unscrupulous fraudsters.
I would like to thank this committee for allowing me time to talk about Mount Real and its victims. Most of us have given up hope of ever recovering any of our money. We feel abandoned by government and law enforcement agencies alike, and we wonder if justice will ever be served. The charges laid against the principals of Mount Real by the AMF will only be heard in the fall of 2010, almost six years after we first realized something was wrong. Our hope is that the governments, both federal and provincial, will continue to listen to us and take action so that the pain and suffering we have endured will not be in vain.
Thank you.