Former Norbourg CEO Lacroix convicted of fraud

Norbourg founder Vincent Lacroix is facing the possibility of years in jail and up to $5 million in fines after being convicted in Montrealon Tuesday of defrauding thousands of investors of their savings.

Quebec provincial court Judge Claude Leblond handed down the verdict at midday after hearing 49 days of testimony at the trial.

Lacroix, who is the former CEO of the Montreal-based investment fund, was arrested in 2006 and charged with 51 counts of violating securities laws after his company was investigated by Quebec's financial market regulator, the Autorit des marchs financiers (AMF).

Twenty-four of the charges relate to Lacroix allegedly providing false or misleading information to investors, and 27 charges are connected to allegations he manipulated mutual funds.

The court found that Lacroix made 134 irregular withdrawals from the investment fund totalling $115 million for his personal use.

Norbourg investors, clients and affiliated companies lost about $130 million of some $205 million placed with the investment firm.

Lacroix showed little reaction to the verdict, raising his gaze only a few times while scribbling notes.

For each count, the AMF can ask for a maximum penalty of five years minus a day, and can fine Norbourg up to $5 million.

Outside the courthouse, Lacroix was chased by a pack of reporters as he headed to lunch.

"I won't make any comment until the sentence is handed down," he said. "I read the judgment and I will analyze it."

Asked ifhe was surprised by the verdict or would appeal, he said he had no comment.

Lacroix did not testify at the trial and did not present any witnesses.

The financial regulator had previously fined Norbourg on behalf of some 9,200 investors.

A forensic audit in 2005-2006 revealed there was a $130 million gap in Norbourg's accounting records.

Norbourg was placed in bankruptcy protection in October 2005.