Sentencing Submission Hearing
December 3, 2025
The following is a Summary of the Sentencing Submission Hearing that took place on December 3, 2025. We would like to thank those who attended in person. The courtroom was standing room only - another room had to be made available due to the overflow.
This summary is not an official court transcript. The sentencing will be delivered on February 2, 2026.
CROWN SUBMISSIONS
Crown counsel Scott Patterson opened by stating that “Rathore and Petrozza’s legacy is that of deceit and greed.” He recommended that each defendant serve 10 years in prison, along with:
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Either a restitution order for the remaining loss of $26 million ($13M per defendant), or
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A fine in lieu of forfeiture, requiring the defendants to repay the outstanding amount; failure to pay the fine would result in the defendants returning to custody for an additional term,
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And a prohibition order under s. 380.2 of the Criminal Code prohibiting them from obtaining, seeking, or continuing any employment or volunteer role that involves authority over another person’s money, real property, or valuable security.
After outlining the Crown’s position, Patterson read the Victim Impact Statements from the investor witnesses. He also submitted the Community Victim Impact Statement, which echoed many of the same themes and harms described in the individual statements. The Community Victim Impact Statement can be read here.
Aggravating Factors Identified by the Crown
1. Magnitude of the Fraud – $35 million
Supported by four independent sources:
1. Affidavit of Daniel Sobel, Managing Director, FAAN Mortgages Inc. ( trustee with full access to BDMC records)
2. Tranche schedules listings of all investors
3. RCMP Cpl. Yu’s financial analysis
4. RCMP Cpl. Laroche’s files of all investor forms and data confirming LTV language throughout
2. Material Deceit
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Security and LTV were central promises to investors.
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Misrepresentations appeared in sales decks, 9D/FSCO forms, investor training, and promotional materials.
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The “Real Security, Real Returns” slogan provided false assurances.
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Personal assurances were made by Rathore & Petrozza to witnesses; ILA was paid for by Fortress.
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Fortress targeted “mom and pop” investors seeking safe, secured mortgages.
3. Causation and Knowledge
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Both defendants knew the true “as-is” values.
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Mortgaging reached 300% LTV, far beyond bank norms.
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Losses directly resulted from their deceit.
4. Nature of the Fraud
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Sophisticated, planned, and motivated by greed.
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Inflated valuations were deliberately sought (including from Petrozza’s cousin Felice).
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Marketing campaigns targeted both English-speaking and Cantonese-speaking communities.
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Over 800 investors were affected.
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The consequences were “devastating and catastrophic.”
Mitigating Factor
Neither defendant has a prior criminal record.
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DEFENCE SUBMISSIONS
Defence counsel Gerald Chan, acting for Mr. Petrozza, opened the defence submissions and addressed the court on behalf of both defendants.
Chan argued that the recommended sentence is “grossly excessive.”
Key positions included:
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Fortress was a legitimate business, not a Ponzi scheme.
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No trust relationship existed between the defendants and investors; brokers held that duty.
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Many Fortress projects exited successfully.
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Investors relied primarily on brokers, not Rathore or Petrozza.
Justice Moore challenged these assertions, noting:
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Witnesses testified they trusted both defendants directly.
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Rathore and Petrozza participated in sales presentations and broker training.
Defence Position on Fraud Amount & Sentence
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Defence argued the fraud should apply only to the five investor-witnesses, avoiding the
mandatory minimum.
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A conditional sentence with repayment to only those five witnesses,
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Or, if the fraud applies to all investors (> $1M), a reduced sentence of 3–5 years.
Additional Defence Arguments
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No intention to cause loss-at worst “recklessness.”
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Many projects were successful; therefore, the model “worked.”
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There was a level of risk
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Appraisals were based on a “credible method,” not intended as “as-is” values.
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The developer (Mady) was responsible for the failures.
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FAAN’s affidavit should not be relied on; RCMP Cpl. Yu’s tracing was “unreliable.”
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There was not an element of secrecy.
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Absence of causation-no direct link that Rathore & Petrozza caused the loss to the investors.
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Claimed the defendants injected their own funds to save the projects.
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Defendants have no prior criminal record.
Justice Moore responded with several points, and raised several questions, including:
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Security is supposed to protect the principal. If there is no security, the principal cannot be recovered.
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Investors supplied all equity and bore all risk, where the developer Mady did not put up any equity and had a 50% stake in the project.
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Asked the Defence whether there is any evidence of expenses Mady and Fortress incurred? (The defence replied "no".)
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Sky City began and remained a parking lot; no value was created.
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Where did all the investors' money go?
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What about priority? Were they (Rathore & Petrozza) behind or ahead of investors? (Defence was going to “check”)
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Security was eliminated through inflated valuations.
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Personal Circumstances Raised
Letters of Support for Petrozza
Chan presented two letters of support from Petrozza’s family members. One from his wife, and another from his father. Petrozza is 50 has 3 children.
His parents are elderly and hopes to care for them as well as his extended family.
No Restitution
Defence provided no restitution proposal for Petrozza
No Fine in Lieu of Forfeiture
Defense argued that:
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Forfeiture should be based on what defendants personally gained, not investor losses.
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Claimed defendants lacked full control over the funds.
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Repeated that constable Yu’s information is unreliable on criminal sentencing or liability.
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Justice Moore responded with several points, and raised several questions, including:
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There is no other suggestion that there were other operating minds of Fortress other than Rathore & Petrozza? The defense replied “No”.
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Tranche schedules are accurate, registered documents. “ What about tranche schedules? Are you saying that I can’t rely on the tranche schedules- that means Fortress didn’t get that money? Where would the money go?” The defence responded: “What did they receive personally is my submission. The test is what came into the offender’s possession or control.” The judge responded: “ Aren’t they in control of the company?”
Prohibition Issue
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Defence argued that would be an issue as they would not ne able to seek gainful employment and stated “ This is not a case where the defendants handled the victims funds.”
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Distinguishable
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Justice Moore asked Chan if the defendants are distinguishable in relation to a fine or restitution, and the sentence since profits were split 80% Rathore and 20% Petrozza. Chan responded that it should be the same sentence/fine for both.
Defence counsel Scott Fenton
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Defence counsel Scott Fenton, acting for Mr. Rathore, continued with the defence submissions and stated that he adopts Chan’s positions. He stated that his client maintains his innocence and has respect for the court, and that Rathore feels badly for the investors losing their money.
Fenton raised several factors:
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Fortress was a lawful and successful business, and in “no way” a scam.
He added that:
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Rathore & Petrozza deserve recognition for the projects that were successful.
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Fortress had a standard financing model where they would get SMLS (investors money) for the soft costs.
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It was not a Ponzi scheme, and unfortunately those projects failed.
The Judge asked: “Did they all have a model where the developer got 50% with no money down?” (No answer from Fenton).
Defence continued:
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Rathore genuinely wanted the projects to be successful and pay back the investors.
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SML’s were not safe, & that they were speculative. Investors were told their loan ranked no more than 2nd, subordinated by construction loans.
The judge asked: “Did you not see the promotional material and forms?” . Fenton replied: “OK, the form had a mistake. I’m saying it’s relevant to moral culpability.”
Fenton continued:
“How does the court sentence Jawad and Petrozza when most of the projects were successful?”
The Judge replied:
“When you’re dealing with people investing in mortgages, the value is important if the project doesn’t work.”
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Singular feature between Collier and Sky City was Mady, the developer, as Mady went bankrupt. The judge asked “Don’t developers invest capital in the project they’re building?”
About Jawad Rathore & his family
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Jawad is 49.
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Has no criminal history.
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Although Fenton did not produce any letters for Rathore, he explained that Rathore has 6 young children, 3 of which have learning disabilities, and their mother has an auto-immune disease. He also has elderly parents (mother has early-onset dementia).
No Submissions for Repayment for Jawad Rathore
Fenton was asked by the judge if Rathore has any submissions for Rathore’s ability to repay the victims.Fenton stated he has no submissions for repayment.
Crown Closing Statements
Patterson emphasized:
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There was a breach of trust: the defendants created the business model and financing scheme.
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They knew opinions of value were not “as is”.
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They withheld the truth and lied directly to their investors.
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There is a direct line between their activities and the risk.They told the LTV was never to exceed 80%.
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They knew it was not secure, and mortgaged loans up to 300%.
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Investor losses stemmed directly from the defendants’ actions, not from Mady.
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Rathore & Petrozza controlled the flow of investor funds.FAAN’s records are consistent and corroborated.
Statement by Jawad Rathore
Rathore spoke briefly (without addressing victims):
“I’m speaking on behalf of myself and Mr Petrozza. Vince and I started this business 16 years ago. We always had the best intentions for all stakeholders. When we took projects it was with intentions of them being successful. We just wanted to share with the court that we had the best intentions. We appreciate the opportunity”.
Next Court Date
Sentencing is scheduled for February 2, 2026.
The court will attempt to make Zoom available. More details to follow.