Lino Matteo sentenced to five years for Ponzi scheme
Former Mount Real CEO must also pay $4.91 million in fines, plus court fees
Lino Matteo is going to jail — again.
The former CEO of Mount Real Corp. was handed the maximum possible prison term on Monday morning after he was found guilty in September of having violated 270 counts of Quebec’s Securities Act.
Quebec Court Judge Hélène Morin agreed with the Autorité des marchés financiers (AMF), the provincial securities regulator, that Matteo deserved a five-year prison term.
Matteo, 55, arrived in court with a backpack and wore a beige buttondown shirt and blue jeans with no belt. He was taken to a jail cell from the prisoner’s dock immediately after Morin read her sentence.
“(This case) contained all the elements of a premeditated or deliberate fraud in which Lino P. Matteo played a key role, showing disregard not only for the applicable principles but for everyone who dared slow down his ambitions,” Morin said in her judgment.
“In that sense, his moral blameworthiness is at the highest level.”
Matteo is also liable to pay $4.91 million in fines, plus court fees.
Outside the courtroom, a spokesperson for the AMF said the organization was happy with the judgment.
“We’re talking today about probably one of the most important securities cases in Canada,” spokesperson Sylvain Théberge said. “We have a very strong judgment, and almost $5 million in fines, so it’s a very clear signal. It’s a very important day for the victims of Mount Real.”
One of those victims was South Shore resident Catharine MacDonald. She said she was satisfied with the ruling, though she is left with the financial and emotional sting of having fallen victim to Matteo’s elaborate Ponzi scheme.
She and her husband lost $300,000 — “our dreams for retirement,” she said.
“Feeling financially secure and then losing all our life savings was very hard,” she said. “And you’re ashamed; you feel naive. But today, it was proved we were dealing with a very skilled fraudster.”
Janet Watson, a Sherbrooke resident who lost $68,000, said this sentence sends a strong message to any would-be fraudster.
“I think it sends a message to every fraudster out there who wants to build an empire like he did and victimize people who are vulnerable and older,” she said. “Many of our victims died waiting to see this day; I just hope they are looking down on us now.”
Victims of the scheme will get back 47 per cent of their initial investment, with cheques set to go out on Thursday as part of a classaction settlement.
This is not the first prison sentence handed to Matteo. Last year, he was convicted in a criminal trial after he and two other men defrauded investors in Cinar Corp. out of more than $120 million by funnelling cash into offshore Bahamian accounts.
In that case, a jury found Matteo guilty of one count of fraud, four counts of forgery and four counts of uttering forged documents.
He was sentenced to eight years in prison, but a Quebec Court of Appeal judge agreed Matteo should be released while he appeals the jury’s verdict.
Matteo’s lawyer, Sylvie Bordelais, said her client must now decide whether to appeal the sentence handed down Monday.
Morin ruled that Matteo’s sentence in the Mount Real scheme must be served consecutively to any prison time he serves in the Cinar case.
While the AMF was asking for the maximum possible prison term, Matteo’s lawyer had asked that he be let off with just a fine because of the length of time it took to hear the case. Matteo had also stated in court that he won’t be able to pay the fine because he is broke.
Watson doesn’t buy Matteo’s sob story, and though it seems unlikely he will pay the fine, she’s satisfied that he will spend time in prison.
“I hope he rots in jail,” she said. “He’s getting what he deserves for the pain he inflicted.”