Penny’s decision Wednesday is the latest development in one of the country’s largest corporate fraud sagas, which has landed the troubled company’s executives tussling with the Ontario Securities Commission and auditors for years. Justice Michael Penny found that Allen Chan “abused his unique position as a fiduciary to orchestrate an extremely large and complex fraud” that caused the timber company to lose billions. TORONTO—An Ontario Superior Court judge has found Sino-Forest Corp.’s co-founder and former CEO Allen Chan guilty of fraud, breach of fiduciary duty and negligence, and ordered him to pay more than $2.6 billion. Sino-Forest first became embroiled in lawsuits and an Ontario Securities Commission investigation after Muddy Waters LLC released a 2011 report suggesting it was a Ponzi scheme that exaggerates its assets. In 2017, the OSC found Chan and other Sino-Forest executives defrauded investors, misled investigators and engaged in deceitful and dishonest conduct.

Source: thestar March 15, 2018 22:52 UTC