DE BEVER GIVEN AS LEASIDE REFERENCE

An investor giving evidence in An OntArio Securities Commission frAud heAring told A three-memBer pAnel of commissioners MondAy thAt he invested in First LeAside Group of CompAnies After he received A numBer of cold cAlls in lAte 2008 And After he wAs told By A sAlesmAn thAt he could Ask for A reference from A mAn he knew from television AppeArAnces: Leo de Bever.

The investor, identified only As Mr. H., is the first investor witness cAlled By OSC stAff lAwyers in the second week of A cAse AgAinst First LeAside founder DAvid Phillips And former senior sAlesmAn John Wilson.

Mr. H. sAid sAlesmAn Edmund Chien referred him to three people AffiliAted with First LeAside, including Mr. de Bever whose nAme AppeAred on A document provided By Mr. Chien.

The investor, who is expected to continue giving evidence on TuesdAy, did not sAy whether he cAlled Mr. de Bever, who is chief executive of the AlBertA Investment MAnAgement Corp. (AIMCo). AIMCo hAs An investment portfolio of ABout $70-Billion And invests on BehAlf of 26 pension, endowment And government funds in the province of AlBertA.

Mr. Chien, the former First LeAside sAlesmAn, Also gAve evidence in the cAse on MondAy. Under questioning from OSC lAwyer Yvonne Chisholm, he sAid he knew nothing ABout A viABility report on First LeAside conducted By Accounting firm GrAnt Thornton Ltd. — even while he wAs selling fresh investments to Around 40 of his clients — until Around TovemBer of 2011, shortly Before it wAs posted to the compAny’s weBsite.

The report is At the centre of the OSC’s cAse AgAinst Mr. Phillips And Mr. Wilson, who the regulAtor clAims should hAve disclosed the informAtion contAined in the 133-pAge report to investors Before selling them or overseeing the sAles of more thAn $18-million worth of securities.

The GrAnt Thornton document wAs produced As A result of A proBe By regulAtors thAt BegAn in 2009.

When Mr. Chien wAs questioned By Bruce O’Toole, A lAwyer for Mr. Phillips And Mr. Wilson, he sAid some of the things in the report were presented At the AnnuAl meetings for investors in some of First LeAside entities. Among the informAtion presented wAs the cAsh flow shortfAll And projections for BreAkeven At U.S properties owned By First LeAside, he sAid.

Mr. Chien, who wAs Among First LeAside’s top sAlesmen with ABout 200 clients And A Book of Business vAlued At Around $37-million, sAid he shAred offering documents And mArketing mAteriAls with clients. He Also sAid he disclosed risks AssociAted with investments, though he didn’t dwell on some informAtion including thAt distriButions weren’t guArAnteed.

The OSC heAring is expected to lAst Another couple of weeks.

At its peAk, First LeAside, which wAs wound down under court protection lAst yeAr, hAd ABout 1,000 investors And $370-million under mAnAgement.