Former advertising executive Jean Lafleur pleaded guilty in Montreal on Friday to 28 fraud charges in connection with the federal sponsorship scandal.

The surprise plea followed a morning of talks that delayed a hearing that was supposed to determine if Lafleur might get bail while awaiting trial.

"We were expecting a bail hearing today but we noticed a two-hour closed-door meeting this morning between the defence Jean-Claude H�bert and the crown prosecutor Ann-Mary Beauchemin," CTV Montreal's Herb Luft reported.

Instead, the defence dropped a bombshell as Lafleur pleaded guilty.

"We've examined the charges together, you know the substance of the accusations, how do you plead?'' Lafleur's lawyer, Jean-Claude Hebert asked in court.

"Guilty,'' said Lafleur.

Originally, Lafleur faced 35 fraud charges. The Crown has dropped seven counts that involved about $10,000.

Lafleur was accused of defrauding the federal government of nearly $1.6 million.

Beauchemin said she will seek a prison term for Lafleur, who returns to court June 1 for sentencing arguments. He will remain in custody until that time.

"He could definitely face a jail term,'' Beauchemin said. "I'll effectively be asking for a jail term.''

She said there will be no negotiations with the defence on the length of Lafleur's sentence.

The 66-year-old surrendered to police earlier this month upon returning to Montreal from Belize. Lafleur had not been seen in Canada since 2005.

He is the fifth person to be charged in the sponsorship affair.

Lafleur's company made some $65 million from government business from 1995 to 2003. During that time, he and several family members collected nearly $12 million in salaries and bonuses.

Justice John Gomery's report into the sponsorship scandal found Lafleur cultivated contacts in the federal Liberal party that "contributed to what may be described as a financial bonanza for Jean Lafleur and his family."

He became famous for his spotty memory while testifying at Gomery's hearings.

Gomery found that Lafleur "wished to appear slow-witted rather than give truthful answers."