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Regulator calls for liquidation of Norbourg

MONTREAL -- There is $130-million unaccounted for at Norbourg Asset Management Inc. -- almost double the initial estimate -- and Quebec's financial regulator yesterday called for the liquidation of the asset management company.

The watchdog's chief executive officer, Jean St-Gelais, announced that he is launching a form of class-action lawsuit on behalf of Norbourg's 9,200 unitholders.

The Autorité des marchés financiers (AMF) said it's calling for the liquidation of Montreal-based Norbourg following the filing of a preliminary report from Ernst & Young, the company administrator since it was shut down in August.

Norbourg's founder and controlling shareholder, Vincent Lacroix, was removed from his duties in August and his licence to act as an investment counsellor suspended amid allegations of fraud and embezzlement at the company.

So far, Ernst & Young has uncovered $85-million of "irregular" transactions at Norbourg, of which $58-million have been traced to such items as acquisitions, withdrawals of funds and loans to company individuals, said AMF executive vice-president Pierre Bernier.

© 2007 The Globe and Mail. All rights reserved.

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