MIC founder siphoned off investor funds for his own use
David Singh, the founder of two unregistered mortgage investment companies in Ontario, has been convicted of defrauding investors.
Singh, whose Fortune Financial managed more than $7 billion in transactions during the mid-1990s, was the brains behind Rockfort MIC and Greenview Capital MIC.
The firms were not registered with the Ontario Securities Commission, and did not invest in any mortgages despite selling securities amounting to $5.6 million, according to court documents acquired by The Globe and Mail.
Singh’s companies did not issue any prospectus for the securities. The investments were made between 2014 and 2018, The Globe and Mail said.
Read more: Regulator warns of fake broker in Quebec
Among those who testified at the Ontario Court of Justice were two former employees of Singh. They said that when asked to provide proof of investor-funded mortgages, Singh was unable to supply documentation beyond that of a single mortgage. The lone mortgage bore the details of an industrial property in Timmins, Ontario, and was dated to four years before Rockfort was formed.
Singh allegedly diverted the funds to expenses like his children’s tuition, a personal sports car, and payments to investors in “prior schemes,” court records showed.
“Mr. Singh was clearly aware that his business was required to use investors’ money to fund mortgages and that this was not happening,” said Justice Mara Greene, who released the decision last week.
Singh’s sentencing has not yet been scheduled. His representatives have not responded to The Globe and Mail’s request for comment.
