Police announced that they have laid a series of charges in connection with what they are alleging was a Ponzi scheme.

The RCMP said Friday that its GTA Financial Crime Section has charged five former executives of Seaquest Corp. and Seaquest Capital Corp.: David Holden, Rose Holden, Anthony Mario Cosentino, Andrew Gaudet, and Edmond Chin Ho So have all been charged with fraud and money laundering; and, the Holdens have also been charged with Bankruptcy and Insolvency Act offenses.

None of the allegations have been proven. The accused are scheduled to appear in court on March 2.

Police are alleging that Seaquest collected $92 million from investors, and promised them high returns. In fact, police say that the funds were not invested, but were used as part of a Ponzi scheme. The alleged scheme came to light after Seaquest filed for creditor protection in 2011. And, in early 2012, the Office of the Superintendent of Bankruptcy (OSB) referred the case to the RCMP which launched an investigation.

Last year, a hearing a panel of the Mutual Fund Dealers Association of Canada (MFDA) settled with a former mutual fund rep who referred several clients, and others, to Seaquest.

According to the settlement, Seaquest and Seaquest Capital were privately owned finance companies that provided alternative financing to businesses that were unable to obtain temporary financing from traditional lenders, such as banks. In that case, those referrals generated about $7.3 million worth of investments for the companies, which were made outside his dealer. He settled with the MFDA by agreeing to a $25,000 fine and a lifetime ban from the securities industry.

“It’s important for the public to know that before investing in any financial venture, they should do their due diligence and that the higher the expected rate of return usually means a higher risk of fraud,” said an RCMP spokesman.