Over 300 investors lost $20 million as fake documents kept retirement fund scam going for years
Over $7.75m in fraud tied to locked-in retirement accounts has led to a five-year jail sentence for Stéphane Gagnon, who was convicted by the Superior Court of Justice in Toronto.
The Ontario Securities Commission (OSC) announced that Gagnon, formerly of Ottawa, was also ordered to repay the full net amount to victims.
From August 1, 2015, to May 31, 2021, Gagnon received more than $20m from over 300 investors across Canada.
He promoted access to funds in locked-in retirement accounts if individuals invested through his company.
A large portion of that money was redirected to other uses.
Gagnon also admitted to using forged lawyers’ letters in an attempt to maintain his business relationship with a trust company where investors’ funds had been deposited.
He was convicted of one count of fraud over $5,000 contrary to Section 380(1)(a) of the Criminal Code, and one count of using a forged document under Section 368(1).
In addition to the jail sentence, the court ordered restitution and imposed a fine in lieu of forfeiture. If unpaid, additional jail time may be served.
“This is a significant outcome for Ontario’s investors who were harmed by Gagnon’s actions,” said Bonnie Lysyk, executive vice president of Enforcement at the OSC.
She added that the OSC will take action when there is evidence of harm to protect investors and uphold the integrity of the capital markets.
The charges were brought by the OSC’s Criminal Investigations & Prosecutions team, part of its Enforcement Division.
The team focuses on securities-related fraud, market manipulation, and breaches of tribunal or court orders.
While charges under the Securities Act are prosecuted by the OSC, those under the Criminal Code fall under the Ministry of the Attorney General.
