Among the hundreds of Albertans accused in BMO's alleged mortgage fraud, the bank is now adding Calgary Conservative MP, Devinder Shory, to its hot list, according to a CBC report stating that 'Shory, a lawyer, executed legal transactions that misrepresented the true mortgage owner of at least five Calgary properties.'
Shory stated that he only learned about the lawsuit against him through reports by the media and told CBC news, "I want to state that I have not yet been served with a statement of claim. When I am, I will defend myself vigorously against these accusations. I have done nothing wrong," he said. "As the matter is before the courts, I have no further comment at this time."
In BMO's statement of claim, it alleges Shory, among several other lawyers, was involved in the "fraudulent scheme of the Malik Group" - a group accused of identifying properties to be used in fraudulent manners, as well as recruiting individuals to participate as straw buyers.
None of the allegations contained in the lawsuit has been proven in court.
Legal documents obtained by CBC news state lawyers, mortgage brokers, and four of BMO's employees were all in on one of the largest mortgage fraud cases in Canadian history. According to the documents, the fraudsters generated at least $140 million, half of which was for fake mortgages.
BMO allegedly discovered the scam after its security department noticed "irregularities" in some of their western Canada mortgages back in 2006. The bank claims the fraudsters would identify the worst home in a good neighbourhood, buy it, and use the neighbourhood's quality to leverage the property's value leading to over-inflated mortgages.
The bank claims the conmen hired "straw buyers", people who put their names down on the mortgage for a fee, and created fake income documents to make the buyers appear more affluent. From there, the group's lawyers (17 have been named in the lawsuit) allegedly drafted the necessary legal documents for the purchase to be legitimized.