Mayor Joe Fontana makes his annual state-of-the-city address at the London Convention Centre on Wednesday Jan 11, 2012.
Credits: MORRIS LAMONT/QMI AGENCY
After his stint as MP that ended in 2006, but before he became mayor in late 2010, Joe Fontana actively touted Vince Ciccone and his Ciccone Group to investors.
Ciccone faces multiple counts of fraud and misleading investors to the tune of $19 million levied by the Ontario Securities Commission. A hearing is scheduled next month.
The official receiver in Ciccone Group's bankruptcy recommended the RCMP look into the case.
Fontana did not return calls this week, but last month when his business and charity connections came under scrutiny, he said Ciccone "is a friend and always will be."
"What people do in their private lives is their own business. I am not associated in that respect," Fontana said.
Ciccone and Fontana, 62, were born 11 days apart and were boyhood friends in Timmins.
Fontana stressed at the time of the interview he had "absolutely nothing to do" with Ciccone's private investment firm. But Ciccone himself and at least one of his investors say otherwise.
As a featured and often keynote speaker, Fontana appeared at a number of dinners and seminars at which the voluble politician touted Ciccone and his Cambridge-based investment group, it's been learned.
Ciccone considered him a paid advisor and consultant.
"We used Joe Sr.'s influence to provide credibility to our products," Ciccone told the official receiver in the bankruptcy of Ciccone Group in early 2011.
The receiver reported returns of as much as 20% interest were paid to some investors.
A Waterloo Region investor, who lost more than $20,000 in the bankruptcy, recalls meeting and seeing "the Honourable Joe Fontana" at dinners and seminars where "he said we should invest with Vince because he is a reputable guy."
The investor said invitations and e-mails from Fontana, often included the honorifics "Hon." before his name and "P.C." after it.
They stand for "Honourable" and indicate membership in the privy council for the former federal cabinet minister and can be used for life.
Fontana, a London MP for 18 years, served in the short-lived Liberal government of Paul Martin as minister of labour and housing.
The investor said it was clear Fontana played a key role.
"I was intrigued by the investments because of the ‘Honourable Joe Fontana,'" said the investor, who didn't want his name used.
Fontana promoted charities including Trinity Global Support Foundation -- founded by Ciccone and now headed by Fontana -- and urged investors to take tax refunds from them and invest with Ciccone and his companies, the investor said.
Many investors were from Waterloo Region.
The investor said he realized his money was gone when he learned Ciccone Group had applied for bankruptcy.
In 2007, Ciccone founded Trinity Global, a registered charity and tax shelter that has attracted tens of millions of dollars with the promise of providing meals to hungry school kids in Canada and medicines for HIV/AIDS sufferers in Africa.
In 2008, Ciccone brought Fontana onto the Trinity Global board when donations stood at about $72,000. By 2011, charitable receipts it issued skyrocketed to nearly $72 million, Canada Revenue Agency records show.
Fontana remains chairman of the board and his son, Ugo Joseph, also known as Joe Jr., is president.
Ciccone left the Trinity board in late 2011 when he ran afoul of the securities commission following the bankruptcy.
The official receiver in the Ciccone Group bankruptcy, Mike Callaghan, noted that when Ciccone left, $8 million was transferred from Trinity to companies Ciccone controlled, including Ciccone Group.
Among the 173 unsecured creditors who are claiming $28.3 million, is Trinity, by far the largest, at $6.5 million.
While Fontana did not return calls this week, he forwarded to his son a QMI Agency request to explain the mayor's connections and those of Trinity to Ciccone and Ciccone Group,
Ugo Joseph Fontana replied by e-mail the Trinity chairman (his father), "has advised that you were inquiring with regard to Vincent Ciccone and Trinity Funds. This matter is in the hands of our lawyers, and is being dealt with through legal channels. The board and staff have been advised by counsel that they are not at liberty to discuss the matter."
This may have been a reference to notice of intent to take legal action for libel issued Aug. 14 against QMI Agency newspaper the London Free Press and two London bloggers for stories about Fontana and his connections to Trinity, Ciccone and others.
In late 2011, Trinity Global became a partner of Global Learning Gifting Initiative, which has worked with charities to distribute educational courseware to the underprivileged and First Nations.
Three previous charities that partnered with Global lost their charitable tax status and the federal government has denied tax claims by individuals based on their participation in the scheme it called a "sham" in federal tax court.
The senior Joe Fontana defended Trinity and said it complies with federal laws governing charities.
The official receiver in Ciccone Group's bankruptcy outlined how Trinity Global operated as a tax shelter, offering tax receipts under Ciccone who "issued inflated tax donation receipts to over 200 times the original investment."
In his report dated April 29, 2011, Callaghan suggested the investigative branch of the federal Office of the Superintendent of Bankruptcy and the RCMP look into the case to see if there was fraud or falsification, destruction, omission or concealing of documents or if false representations were made.
On Friday, the Mounties in London said they can't comment on whether an investigation has been launched.
Trinity is by far the largest of the unsecured creditors in the bankruptcy. Smaller ones include Joe Fontana Jr., for $96,000.