Quebec's securities watchdog is demanding the maximum sentence available under the law against a businessman found guilty of running what amounted to a Ponzi scheme.
The AMF called for Lino Matteo to spend five years in prison and pay fines of $4.8 million after defrauding investors of at least $108 million.
Matteo was found guilty earlier this month of 270 counts of securities fraud.
Because Matteo was charged with violating the securities act, and not through the criminal code, five years in prison is the longest possible sentence.
The AMF cannot have someone sentenced to more than five years, no matter what the fraud is.
The prosecution said the $5 million fine attached to the sentence argument is largely symbolic, because Matteo doesn't have any known assets.
Matteo was founder and president of Mount Real, which scammed 1,600 investors through a financial structure so complicated, and so ephemeral, that nobody understood it.
In reality the company was taking money from later investors and giving it to earlier investors, while taking a substantial cut.
The company collapsed in 2006 when it declared bankruptcy. The $108 million is gone and Matteo says he doesn't know what happened to it.
The case has dragged through the courts for almost a decade.
During sentencing arguments, the Crown pointed out that Matteo blamed rules, regulators, and bankruptcy trustees for the fiscal loss, and said Matteo would do it all again if he could.
Matteo, who represented himself throughout the trial, hired a lawyer to argue his case for sentencing arguments.
The sentencing phase will continue next week, when Matteo’s lawyer Sylvie Bordelaiscan argue for a lesser sentence.
