Decisions and Freeze and cease trade orders Securities

Montréal – In a decision handed down on June 14, 2007, Judge Rodolphe Bilodeau of Superior Court (district of Montréal) sentenced Michel Maheux to a prison term of 21 days, with costs.

The sentence is further to the guilty verdict for contempt of court delivered against Mr. Maheux on April 12, 2007. He had violated a permanent injunction order issued by Judge Jocelyn Verrier of Superior Court (district of Richelieu) on October 11, 2005.

In his decision, Judge Verrier ordered the Coopérative de producteurs de bois précieux Québec Forestales (“Québec Forestales”) and Michel Maheux, in particular to:

  • Cease and refrain from distributing preferred units of Québec Forestales, investment contracts or other forms of investment contemplated in section 1 of the Securities Act (the “Act”), through any channels, including correspondence and websites.

However, as demonstrated by the Autorité des marchés financiers (AMF), Mr. Maheux used websites to distribute forms of investment contemplated in section 1 of the Act, without a prospectus approved by the AMF. Judge Bilodeau concluded that Mr. Maheux had not complied with the permanent injunction order.

In imposing the sentence, Judge Bilodeau concluded that a fine would be ineffective, given that Mr. Maheux had already been sentenced to a prison term of 10 days. The matter involved a repeat offence.

On March 22, 2005, Judge Jean-Guy Dubois of Superior Court (district of Richelieu) sentenced Mr. Maheux to 10 days in prison and a fine of $4,500 further to a guilty verdict for contempt of court for violation of a provisional interlocutory injunction order.

On May 11, 2005, Judge Jean-B. Falardeau of the Court of Québec (Criminal and Penal Division), district of Montréal), found Mr. Maheux guilty of 37 charges for assisting Québec Forestales in violating a decision of the Québec Commission des valeurs mobilières. As well, he found him guilty of 37 charges for assisting Québec Forestales in making misrepresentations in respect of a securities transaction. Mr. Maheux was ordered to pay a fine totalling $222,000, plus costs. The fine has not yet been paid.

The Autorité des marchés financiers (AMF) is the regulatory and oversight body for Québec’s financial sector.

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