Canadian federal police are conducting a search at the headquarters of electric-school-bus manufacturer Lion Electric Co. as part of an ongoing investment fraud investigation. The operation, led by the Royal Canadian Mounted Police’s Integrated Market Enforcement Team, involves as many as 75 officers and is focused on the company’s Saint-Jérôme, Quebec facility, approximately 60 kilometres northwest of Montreal.
Authorities executed a search warrant on Wednesday to collect evidence, including computer servers, and indicated that the scope of the premises could extend the duration of the search over several days. No arrests or charges are expected at this early stage, according to RCMP spokesperson Sergeant Enrique Gasse.
The investigation began in February 2025 following complaints from over 100 investors. Sergeant Gasse noted the probe relates to activities undertaken by Lion Electric under previous ownership, when the company produced both electric school buses and trucks. Lion’s current management emphasized in a statement that the RCMP’s inquiries concern the company as it existed prior to its acquisition in May 2025 and stated it is cooperating fully with law enforcement.
A class-action lawsuit filed last year in Quebec by the U.S.-based law firm Scott+Scott provides additional context to the allegations. The suit claims that from May 2021 through December 2024, Lion’s directors, officers, auditors, and underwriters issued documents containing misleading information and omitted significant facts concerning the company’s financial condition, product quality, production capacity, order backlog, growth prospects, and profitability.
Among the claims cited in the lawsuit was Lion Electric’s reported relationship with Amazon.com Inc., which included the promise of potential orders for up to 2,500 trucks. While a limited number of trucks were delivered to Amazon, the lawsuit alleges that the anticipated volume of sales never materialized. None of these allegations have been adjudicated in court.
A separate investigation by Radio-Canada last year similarly suggested that Lion had overstated its order book and failed to disclose the loss of key customers while publicly traded. The broadcaster’s findings were based on interviews with former sales managers and examination of confidential company documents. The company has denied any wrongdoing and maintained compliance with disclosure requirements.
Founded by Marc Bédard, Lion Electric went public in 2021 with ambitions to innovate in zero-emission transportation. The company initially focused on electric school buses and later expanded into electric trucks, establishing an innovation center and multiple manufacturing facilities, including one in Joliet, Illinois.
However, Lion struggled to scale manufacturing operations and faced bureaucratic challenges, including delays in subsidy approvals under Canada’s $2.75-billion Zero Emission Transit Fund. Financial pressures eventually led the company to file for bankruptcy protection in December 2024 after exhausting cash resources and losing critical government support, including tens of millions invested by the Quebec government, which discontinued funding.
In May 2025, a new ownership consortium led by real estate developer Vincent Chiara and former Lion board member Pierre Wilkie acquired the company. The restructured firm ceased electric truck production to concentrate on school buses and benefited from renewed provincial subsidies aimed at promoting electric bus adoption. The company currently employs around 200 workers.
Lion overcame an early test under the new ownership in September 2025, when the Quebec government mandated the temporary removal of its electric buses from service after one vehicle caught fire. The issue was linked to HVAC system components and resolved through repairs, allowing buses to return to operation.
Moving forward, the company’s revival efforts hinge on restoring its market reputation and securing sufficient sales to support growth within the evolving electric transit sector.