Former Montreal school board official recounts fallout from corruption charges

The defence for Caroline Mastantuono, who once led Lester B. Pearson School Board's international department, is seeking an absolute discharge after she pleaded guilty to charges related to fraud and embezzlement in May.

During sentencing arguments Tuesday afternoon, Mastantuono was questioned by her lawyer, Jonathan Gordon, at length.

She recounted how she became the manager of the international department for the Montreal-based English-language school board in 2003, and was promoted to director in 2013.

In June 2016, Mastantuono said she was suspended by the school board for financial mismanagement. She was subsequently fired as were two of her children, who also worked at the school board.

By then, the school board's international department had grown from seven students to nearly 800, bringing in millions of dollars in tuition.

"I was devastated," said Mastantuono, who was accompanied to court by her husband and three children. "I worked day and night and was proud of the job I'd done."

UPAC charges scuttled private business

Following Mastantuono's dismissal from the school board, she started Rising Phoenix International, a company that helped recruit international students for private colleges.

To cover startup costs and overhead, Mastantuono said she and her husband mortgaged their home.

By 2019, the company was doing so well, it started its own private technical college, M College, in Montreal's southwestern LaSalle borough. It offered courses in everything from multimedia to early childhood education.

Mastantuono said they wanted to add more programming and potentially start a language school. They began meeting with different financial institutions to secure a loan.

But in November 2020, Mastantuono and her daughter Christina, who had worked with her mother in the international department, were charged by UPAC — Quebec's anti-corruption unit.

The agreed upon statement of facts outlines the use of two schemes to commit various offences between June 2014 and March 2016.

The first scheme involved the forgery of tuition receipts that were used to secure Quebec Acceptance Certificates (CAQs), which authorize international students to study in the province.

The court documents show Mastantuono instructed staff to forge a total of 81 false receipts, misleading authorities into issuing CAQs to students who didn't meet financial requirements.

These receipts represented a sum of over $1.6 million.

Mastantuono's lawyer argued that although she was portrayed in the media as a "master fraudster," she did not derive any personal gain from this scheme.

"Not one cent," Gordon told Quebec Court Judge Salvatore Mascia.

The second scheme centred on the embezzlement of funds through unauthorized payments to a recruitment agency owned by Naveen Kolan, a Toronto-based consultant with Edu Edge Inc.

Kolan has since pleaded guilty to a charge of breach of trust and is scheduled to be sentenced Dec. 20.

'We lost everything'

During several parts of Mastantuono's testimony, her children wiped away tears.

When her lawyer asked her how she felt when UPAC officers showed up at her door back in 2020, she recalled being in shock.

"It was a disaster," said Mastantuono, who spoke through tears. "I was out of my mind with worry and so scared for my daughter."

Due to the accusations, Mastantuono said the banks withdrew their support for Rising Phoenix. Some of the private colleges they had recruited for also threatened legal proceedings.

The COVID-19 pandemic also meant that many of the students they recruited could not get a study permit. CBC News previously reported that dozens of those students, mostly from India, were unable to get their tuition refunded, leaving many in financial distress.

In January 2022, Mastantuono said Rising Phoenix had no choice but to close its doors and file for creditor protection.

"It was a dark year for our family," said Mastantuono. "We lost everything."

To meet their obligations under the creditor protection proceedings, Mastantuono said they had to pay about $1 million. To cover that amount, Mastantuono said they sold their cottage in Ste-Adolphe-d'Howard and two other properties.

Unable to work in the education sector, Mastantuono said she went back to school and now works as a chef.

Mastantuono's lawyer presented the court with 22 letters of reference from friends, family and former colleagues, including Robert Mills, Lester B. Pearson's former director general.

Crown prosecutor Émilie Robert said Lester B. Pearson School Board did not wish to make an impact statement during the sentencing arguments.

The prosecution is seeking a conditional discharge and 15 to 18 months of probation. Robert said it is asking the judge to impose certain conditions, including house arrest and a curfew.

Mastantuono, her daughter and Kolan all originally pleaded not guilty to the charges. The charges against Christina Mastantuono were withdrawn by the Crown following Caroline's guilty plea.

The judge is scheduled to rule on Mastantuono's sentence on Nov. 22.