Quebec's securities regulator has filed 133 charges against insurance salesman Richard Longpré, accusing him of improperly raising $1.3-million from clients, including money for loans to buy computers.
The Autorité des marchés financiers said it is seeking fines totalling $1.3-million and a prison term in the case, alleging Mr. Longpré acted illegally as a securities dealer on 61 occasions, made illegal distributions of securities on 61 occasions and made misrepresentations to investors on 11 occasions by wrongly declaring investments were safe and involved no risk.
The AMF said 33 investors lost $1.32-million between 1998 and 2009, although the regulator said Mr. Longpré reimbursed some investors a total of $211,000. The AMF said he sold personal and group insurance and group savings plan products.
"Drawing on the relationship of trust he established with his clients, Mr. Longpré proposed to some clients that they lend him money so that he could invest the funds on their behalf, letting them believe that he had privileged access for purchasing shares in various oil companies," the AMF said in a release Tuesday.
The regulator alleged Mr. Longpré proposed other clients lend him money to buy more powerful computers so he could better manage their assets. In exchange, he allegedly promised an annual 8 per cent return to investors and issued term notes to the lenders.
Montreal lawyer Marc Boudreau, who represented Mr. Longpré on related allegations before the AMF last year, said Tuesday he was unaware the regulator had filed new charges, but said he was sure they would be contested.
He said Mr. Longpré invested all the money he was given by his clients, and disputes allegations he misappropriated funds. He added Mr. Longpré has acknowledged it may have been an error to arrange loans from his clients, but denies it was illegal.
Mr. Boudreau said his client became sick with cancer and fell behind on the loan repayments because he could not work for a period of time, but did not intend to keep the money.
A court date has not been set yet in the case. The AMF said it is seeking a fine and prison term because of "aggravating factors," including the long duration of the alleged violations and "the consequences on victims whose financial position he was familiar with."