The former leader of Otéra Capital, Alfonso Graceffa, had to answer questions on Wednesday from the lawyer for the Caisse de depot et placement du Québec, as part of the lawsuit he brought against the institution. Mr. Graceffa notably had to explain his undeclared role in his brother’s construction company, and his meeting with an individual with a criminal past.
The Caisse’s lawyer, Mason Poplaw, put Mr. Graceffa in the hot seat by questioning him about the “serious ethical breaches” that the woolen stocking of Quebecers accuses the former manager of his mortgage subsidiary and which led to his dismissal.
Among these shortcomings, the Caisse accuses Mr. Graceffa of having gradually taken control of a company – in this case Construction Sainte-Gabrielle (CSG), his brother’s company – without declaring it.
While Mr. Graceffa’s brother owed him 2 million dollars, the latter admitted to the Court, the former manager of Otéra agreed to exchange part of his debt for shares of CSG – which represented 50 % of shares with voting rights of the company.
Mr. Graceffa, however, assured that he did not make decisions within the company. “It’s my brother. It’s a one man show. It’s a small company,” he said, trying to convince the judge that he didn’t control the company, even though he did at some point gain the power to act legally instead of his brother “who was not well”.
“I have never practiced [ce pouvoir] “said Mr. Graceffa before being interrupted by judge Andres Garin. “Sorry, but I saw a document that you signed under that authority,” he said.
Meeting with an individual with a criminal past
Asked about his knowledge of the criminal past of Jean-Denis Lamontagne, from whose hands he accepted a payment of 15,000 dollars, another “breach” noted by the Caisse, Mr. Graceffa repeated that he knew nothing about it.
“I was not aware of Mother’s grave,” he said, acknowledging that he had not checked before meeting Mr. Lamontagne at his office. The former manager of Otéra also pleaded that he did not know that this sum, used to recover a debt owed to the brother of Mr. Graceffa, would be given in cash.
“From an ethical point of view, and considering what the public might think of it, hasn’t it occurred to you that you should refuse this envelope?” asked Mr. Poplaw. “If I had known who he was, I would not even have met this gentleman,” assured Mr. Graceffa.
Alfonso Graceffa was also questioned about the ethics of his ties with his “business friend”, developer and broker Thomas Marcantonio, who received a $44 million loan from Otéra for the construction of a residential project for retired people in Saint-Jean-sur-Richelieu. Cross-examination by counsel for the Caisse de depot is scheduled to continue tomorrow.
Alfonso Graceffa, who believes he was unjustly dismissed and defamed by his former employer, is suing him for $6.9 million.