Lawyer faces charges in fraud case after developer flees

Lawyer faces charges in fraud case after developer flees

Lawyer faces charges in fraud case after developer flees Down payments, which may total more than $12 million, have disappeared and charges have been laid in a Canadian fraud case.

Meerai Cho, a Toronto-based lawyer, represented the developer of the North York condo hotel “Centrium” – a project that fell through earlier this year. The case has become a reminder for brokers and Realtors to advise clients to do their due diligence before forking over their deposit money for pre-construction builds.

“Our thoughts are that it shows how important it is to buy pre-construction through reputable builders. Buyers should always research the project as well as other developments done by the builder,” Erica Smith of Condo Chicks told MortgageBrokerNews.ca’s sister publication, CREW. “We would never take clients to a pre-construction sales office without knowing the reputation of the builder.

“It's so important these days considering the amount of fraud and international money in the Real Estate market.”

The developer’s lawyer is facing 75 count related to fraud after the developer disappeared – along with the down payments -- following the dissolution of the project.

According to a police representative, the project seemed legitimate and not a front for a scam.

“From what I can see, from the planning went in from the city of Toronto, some of the paperwork, this was beyond just being a scam,” Toronto Police Detective Constable Chris Devereaux told Global News. “It looks like it was going to be a development, for whatever reason it just collapsed.”

Still, 25 people have already come forward and claimed fraud. One individual is relieved charges have been laid, though he is still out $220,000.
“Relief, a little bit but how do I get my money back?” the man told Global News.
 
18 Comments
  • Myer Betel 2014-08-27 12:13:11 PM
    Why are you calling this a Mortgage fraud when there are no Mortgages involved?
    It is either Solicitors negligence, or fraud.
    Post a reply
  • Len Lane 2014-08-27 12:26:55 PM
    Even reputable builders go under, Greenboro Homes in Alberta left a lot of people holding the bag not only on deposits but on work not completed as well. In pre sales I've always thought it was crazy for the money not to go into trust with a lawyer.
    Post a reply
  • Guillermo 2014-08-27 12:30:42 PM
    I agree with Myer Betel. If there were any banks or mortgage brokers involved, the writer left them out. If there weren't, then why would you label it mortgage fraud? While it grabs the attention of your readers, when they dig through the details and see there were no banks or brokers involved it frankly puts them off because it looks like you are trying to gain readership and advertising revenue at the expense of the industry you're trying to serve.
    Post a reply