Zenith Corporation - AMF files 89 charges against Denis Patry , seeks prison term and fine of $2,157,000

Securities

Montréal – The Autorité des marchés financiers (AMF) has launched penal proceedings in the Court of Québec (Criminal and Penal Division), district of Montréal, against Denis Patry and is seeking a total fine of $2,157,000 and prison terms related to this matter.

According to the AMF, Denis Patry violated the Securities Act (the "Act"):

  • by aiding, by act or omission, in making a distribution of a form of investment governed by the Act, without a receipt for a prospectus from the regulatory authority, thereby violating section 11 of the Act (1 count, $10,000 fine sought);
  • by acting as a securities dealer without being registered with the regulatory authority, thereby violating section 148 of the Act (1 count, $2,000 fine sought);
  • by aiding ZENITH Management and Research Corporation to not comply with a commitment made to the AMF, namely, by aiding it to invoice ZENITH Fund for financial research expenses and to withdraw funds belonging to ZENITH Fund to pay these expenses, thereby committing the offence under section 195(2) of the Act, with reference to section 208 of the Act (6 counts, $120,000 fine sought);
  • by aiding, by act or omission, Les conseillers en valeurs Planiges inc. to make misrepresentations in respect of a transaction in a security, namely, by indicating in the account statements of the securities comprising the client's portfolio that the value of a security was a certain amount, which was not the case, thereby committing the offence under section 197(1) of the Act, with reference to section 208 of the Act (81 counts, $2,025,000 fine and prison term sought).

As part of its suit, the AMF is seeking fines that are two to 20 times higher than the minimum fine set out in the Act owing to the objective and subjective seriousness of the offences, for exemplary reasons and as a deterrent. The harm caused to the victims and the number of victims involved were also considered in determining the fines in this matter.

In addition, for each of the 81 charges related to misrepresentations that carry prison terms, the AMF is seeking a term of up to 5 years less a day.

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

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