Fortress Real Developments

Fortress Real Developments Inc. (often Fortress Real) was a Canadian real-estate development and lending company that helped finance early-stage projects using syndicated mortgage investments marketed to retail investors. Between about 2008 and 2017, Fortress-linked offerings raised roughly $900–$920 million from thousands of investors across dozens of projects in Canada.^[1][2]

Fortress and related mortgage brokerages became the focus of regulatory enforcement beginning in 2018. In 2020, Ontario's financial regulator imposed an administrative penalty on the company for mortgage-rule contraventions.^[3] In 2022, the Royal Canadian Mounted Police (RCMP) charged Fortress's co-founders, Jawad Rathore and Vince Petrozza, with fraud and secret commissions.^[4] Both men were convicted in May 2025 of fraud over $5,000; sentencing was pending as of September 2025.^[1][5]

Fortress Real Developments was founded in 2008 by Jawad Rathore and Vince Petrozza to arrange capital for early-stage real-estate projects, often by pairing developers with retail investors through syndicated mortgages.^[5]

Fortress raised over $900 million in syndicated mortgage loans before Rathore and Petrozza were charged with fraud.^[6] In September 2020, FSRA and Fortress entered into a settlement that included a $250,000 administrative penalty against the company.^[3][7]

Investments were commonly brokered and/or administered by former in-house broker Building & Development Mortgages Canada (BDMC) and other spin-outs from BDMC and Fortress. The three affiliated firms - FDS Broker Services Inc., FFM Capital Inc. and FMP Mortgage Investments Inc., - were companies whose primary or sole business was brokering Fortress products.^[6] On February 1, 2018, the Superintendent of Financial Services announced $1.1 million in administrative monetary penalties and licence revocations for BDMC and several individual brokers that marketed Fortress-related syndicated mortgages.^[8] The individuals were Vince Petrozza (Fortress' co-founder), Rosalia Spadafora, Michael Daramola and Glenn May-Anderson. Additionally, Ildina Galati-Ferrante, former principle broker of BDMC, agreed to surrender her license at the same time.^[9]

On April 20, 2018, FAAN Mortgage Administrators was appointed by the Ontario Superior Court as trustee over BDMC's assets and administration of its syndicated mortgage portfolio.^[10]

Beginning in 2016, multiple proposed class actions were filed in Ontario concerning projects marketed alongside Fortress Real Developments, alleging overvaluation of underlying land and misleading risk disclosure to retail investors. In August 2016, a proposed class action tied to Barrie's Collier Centre sought $27.5 million and criticized the way syndicated mortgages were presented to retail investors.^[11]

In October 2016, CBC reporting noted that a SkyCity (Winnipeg) sales presentation to Toronto investors touted 8% returns while omitting key feasibility details, and that three proposed class actions alleged land overvaluation in Fortress-linked projects.^[12][13]

Court filings summarized the same month by industry press alleged investors were provided an “inflated current value” derived from hypothetical future values, rather than “as-is” appraisals.^[14] By December 2016, a fourth claim (involving Harmony Village – Lake Simcoe) lifted alleged damages to roughly $100 million, and was the first to include a fraud claim, according to plaintiff counsel cited in coverage.^[15]

In November 2017, a Reuters investigation reported that provincial files documented recurring investor complaints: that principal could be at risk, 8% returns were not guaranteed, and substantial fees/commissions (up to ~35%) were deducted; the story also revealed the RCMP opened an investigation in October 2016 into Fortress's syndicated mortgage business.^[16] These pre-2018 complaints—particularly around valuations based on projected (rather than “as-is”) property values and non-disclosure of fees and risks—anticipated themes later advanced by prosecutors at trial.^[11]

Following a multi-year RCMP Integrated Market Enforcement Team investigation (sometimes referred to publicly as “Project Dynasty”), the co-founders were charged in June 2022 with fraud and secret commissions, with initial appearances scheduled in Toronto.^[4][17]

An Ontario Court of Justice trial presided over by Justice Daniel Moore began in October 2024 and focused on two Fortress projects: the proposed SkyCity tower in Winnipeg and the Collier Centre in Barrie, Ontario.^[2] On May 28, 2025, Justice Daniel Moore found both Rathore and Petrozza guilty of fraud over $5,000.

The court concluded that investors were misled when loan-to-value ratios were presented using projected future values rather than current “as-is” values, which amounted to the non-disclosure of material facts.^[1] These findings echoed concerns raised years earlier in civil lawsuits and press reports: in 2016–17, multiple class actions and media investigations had already alleged that land was overvalued on a “future” basis, that risks were minimized in marketing, and that substantial commissions were not disclosed to retail investors.^[14][16] As of September 2025, sentencing had not yet occurred. Fraud over $5,000 carries a maximum penalty of 14 years’ imprisonment and, where losses exceed $1 million, a mandatory minimum sentence of two years.^[5]