Montréal, July 26, 2011 - The Autorité des marchés financiers (the "AMF") has launched penal proceedings in the judicial district of Montréal in connection with the activities of Fer de Lance Foundation (the "Foundation"), also widely referred to as FFDL. The proceedings target the Foundation and six individuals involved with the Foundation. The AMF filed 258 charges and is seeking fines totalling $3,741,000 and prison terms against Paul M. Gélinas, the trustee executor of the Foundation and Me Jean-Pierre Desmarais, legal adviser to the Foundation.

More specifically, Paul M. Gélinas was charged with 70 counts, of which 33 relate to illegally acting as a securities dealer or adviser, 33 counts for aiding with illegal distributions and four for illegal distributions without a prospectus. The AMF is seeking a prison term of five years less one day and/or fines totalling $1,090,000 against him.

Me Jean-Pierre Desmarais, the legal adviser to the Foundation, was charged with 34 counts for aiding with illegal distributions and 34 counts for acting illegally as a securities dealer or adviser. The AMF is seeking a prison term of five years less one day and/or fines totalling $1,025,000 against him.

The AMF also filed charges against two directors of the Foundation, namely, George E. Fleury, chairman of the board of directors and chief executive officer, and Michel Hamel, secretary-treasurer and managing director, who were each charged with 34 counts for authorizing and permitting illegal distributions without a prospectus. The AMF is seeking fines totalling $340,000 against each director.

Charges were also filed against two alleged recruiters for the Foundation. A total of 14 charges were filed against Réjean Duguay, an alleged recruiter in the Sherbrooke area, who is accused of aiding the Foundation with illegal distributions on seven occasions and acting illegally as a securities dealer or adviser on seven occasions. The AMF is seeking fines totalling $84,000 against him. As for Denis Nadeau, an alleged recruiter in the Québec City area, he has been charged with four counts, two of which relate to aiding the Foundation with illegal distributions and two for acting illegally as a securities dealer or adviser. The AMF is seeking fines totalling $12,000 against him.

Finally, the Fer de Lance Foundation, whose mission is to "dedicate all efforts and available means to enhance the well being of the Human Race, was charged with 34 counts for illegal distributions. The AMF is seeking fines totalling $850,000 against the Foundation.

In this matter, most investors were first approached by recruiters who asked them to provide various pieces of personal information. The investors were then invited to a lawyer's office in Montréal where they met with Paul M. Gélinas, signed various documents and handed over a bank draft for deposit into a trust account. The investors felt reassured by the presence and actions of Me Jean-Pierre Desmarais.

On July 17, 2009, at the request of the AMF, the Bureau de décision et de révision (the "Bureau") issued a cease trade order that prohibited the distribution of investment contracts issued by the Foundation and by Fer de Lance Foundation Turks and Caicos (FDL Turks and Caicos Foundation) by both organizations as well as by Jean-Pierre Desmarais, Michel Hamel, George E. Fleury and Paul M. Gélinas. The Bureau also froze the funds, securities and other assets of the Foundation and of the FDL Turks and Caicos Foundation. Numerous legal debates have been conducted since July 2009 on this matter.

At the same time as the order issued on July 17, 2009, the Ontario Securities Commission froze the Foundation's bank accounts at the request of the AMF. The funds frozen in Ontario were subsequently transferred to Québec and included in the freeze order issued by the Bureau.

The Autorité des marchés financiers (the "AMF") is the regulatory and oversight body for Québec's financial industry.

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