Wednesday, March 2, 2011

Norshield back in the News - Warrant for John Xanthoudakis' arrest - Fraud Charges pending

Although there is no immediate benefit to investors of Norshield, it is also of no surprise to see that John Xanthoudakis has been charged with fraud in connection with Cinar and Norshield. It appears that four men in total have been charged with fraud, two from the Cinar corporation, Xanthoudakis from Norshield and Lino Pasquale Matteo of the Mount Real, yet another Canadian fraudulent fund in which 1,600 clients were defrauded of $130 million dollars.

The charges relate to misappropriation of $120 million dollars of the Cinar Corporation's funds which were invested for the personal profit of then CEO & CFO. The allegation is that Xanthoudakis helped to invest the funds in the Bahamas while Matteo helped to hide the investments. The warrant lists 36 criminal charges including fraud, forgery, and use of a false prospectus.

Some irony in this story is that the AMF (Quebec's securities commission) had earlier fined both of Cinar's CEO &CFO $1 million for these illegal actions. Why didn't they uncover more info? Why didn't they move on criminal proceedings? Did the $1 million each ever get paid?

Here are the links to the news stories.