MONTREAL - A 58-year-old Montreal man could face up to eight years in prison for running a scheme that defrauded the Canada Revenue Agency and Revenu Quebec for more than $12 million.

Ronald Chicoine pleaded guilty in 2008 to laundering millions of dollars for organized crime figures, and saw assets worth nearly $50 million seized by authorities.

The prosecution asked for the eight-year sentence Thursday at the Montreal courthouse, when it called on an array of forensic accountants to explain Chicoine's fraud case.

Chicoine once ran Speedo, a Quebec-based investment company, where he specialized in providing financing to taxi drivers who needed six-figure loans to buy permits.

Speedo took money from organized crime and invested it in offshore accounts through a complex scheme involving empty shell companies.

Some of the cash would also be loaned to construction companies, which would in turn pay workers under the table.

The scheme allowed Chicoine to avoid paying $12 million dollars in taxes -- and created an almost insurmountable task for investigators, said prosecutor Claude Girard.

"It was all taking place outside Canada, which made our job of investigating that much harder," he said Thursday at the courthouse.

The Surete du Quebec arrested Chicoine in May 2008.

"Chicoine already has a lengthy record for fraud, and he was laundering money for the mob," said Girard, who insisted on the jail time.

The defence is asking for three and a half years in prison, and pointed to the fact that Chicoine easily reimbursed $10 million to the government.