The Norbourg scandal is a major financial scandal that took place in 2005. The scandal involved the Montreal, Quebec based Norbourg Financial Group, a trust-fund company founded by Vincent Lacroix. He diverted money from a Norbourg trust fund for personal interests. Nearly 9,200 investors in Quebec lost millions of dollars. It is considered as one of the largest Canadian financial scandals in history and largest in Quebec. Origins The scandal came into light during the summer of 2005 after the Autorité des marchés financiers (AMF - "Financial Markets Authority"; the province's top financial regulator) discovered that C$130 million was missing from company accounts. The loss was initially estimated at C$70 million before a report by Ernst & Young revealed additional losses. On August 25, 2005, police raided the Norbourg headquarters office in Montreal as well as smaller offices in Quebec City and in the Eastern Townships region. After having its assets frozen, the company ceased its operations in October 2005 and filed for bankruptcy. Lacroix himself was declared bankrupt in May 2006 by a provincial judge. A report by Ernst & Young revealed that all firms run by Lacroix including Norbourg Gestion d'actifs, Norbourg Groupe Financier, and Fonds Évolution had operational deficits up to $6.5 million in 2005 alone. The AMF filed 51 charges against Lacroix in March 2006 related to false and misleading information and manipulating mutual fund values. The regulator accused Lacroix of using Norbourg's funds for personal reasons. 29 funds were affected, with 11 of them having nearly no value left and 17 others having C$300,000 or less left. Investigation and fraud tactics Investigators reviewed some of the transactions and cheques dating back to 2000 and found 69 files related to the 51 charges. However, funds were diverted starting in 2003 and the deficit ballooned from $9 million to $70 million and finally up to $130 million. Money was diverted from the funds to a "ghost account", some of which was transferred to Lacroix and his wife. False receipts were also made to hide the company's losses. In addition, Norbourg hired a computer specialist to falsify reports to Northern Trust, whose Toronto office was asset custodian for the Norbourg and Evolution funds. The worker had access to all the financial data of Norbourg. Some of the stolen money was paid out in bonuses and gifts to favored Norbourg employees; one employee's house was purchased with embezzled funds.