Meerai Cho faces 75 charges relating to condo deposits
CBC News
26 August 2014

(Toronto Police Service)
 Toronto police have laid 75 charges against a newly suspended lawyer who is accused of failing to return deposits to purchasers in a cancelled condo project.

Meerai Cho has been charged with 25 counts of fraud over $5,000, 25 counts of possession of property obtained by crime and 25 counts of breach of trust. None of the allegations have been proven in court.

Police allege that Meerai Cho had been acting as a lawyer on behalf of the Centrust Group and had "completed purchase-and-sale agreements for pre-construction condominiums" at 5220 Yonge St.
It is alleged that the Centrium condo project fell through, but Cho did not return the deposits to the buyers.

On Tuesday afternoon, police announced that Cho faces 25 charges each of fraud over $5,000, possession of property obtained by crime and breach of trust.

None of the allegations have been proven in court.

Police believe there may be other victims to the alleged crimes.

"We are at the infancy of our investigation and we have only had 25 complainants come forward to the Toronto Police Service," Det.-Const. Chris Devereux said Tuesday. "Through our investigation and through our warrants, we have identified a potential 141 complainants with a value of $12.4 million in expected loss."

Devereux said the complainants made deposits ranging from $40,000 to $700,000.

"This was a condo development that was going to have residential and commercial properties. Some people were buying several commercial units, as well as residential units and were required to put large sums of money down in regards to this," he said.

Devereux said police have only identified a single suspect at this time, though they will advise the public if their investigation leads to any other arrests.

Cho, 63, is due to appear in court on Oct. 2. Police say she has handed over her passport.

The accused has been suspended by the Law Society of Upper Canada.

She was not present at a Law Society hearing about the case on Tuesday.

top
Law firm seeks to return $9M in deposits to Centrium buyers
CBC News
28 August 2014

A law firm in Vaughan is seeking permission to return $9 million in deposits it has been holding in trust for a condo project that has been cancelled.

The Centrium condominium project was supposed to be built at 5220 Yonge St. The proposed development involved both residential and commercial units.

In 2010, Brattys LLP had acted for Centrium on the project, but the law firm said in a statement that its retainer was terminated at the end of that year.

Centrium then retained lawyer Meerai Cho as its solicitor.

The law firm is not commenting further on the matter, as police are currently investigating an alleged fraud involving Cho.

Brattys said that as a trustee of residential deposit monies, it is currently seeking court approval to "expedite the return to buyers of approximately $9 million in Centrium residential condominium deposits currently held in trust" by the law firm.

That hearing is supposed to take place on Tuesday.

The money that Brattys has been holding in trust is separate from the funds that are at the centre of the investigation involving Cho.

Cho was charged with 25 counts of fraud over $5,000 this week, along with 25 counts of possession of property obtained by crime and 25 counts of breach of trust.

None of the allegations against Cho have been proven in court.

top
Real estate lawyer faces discipline by Law Society
Toronto Star
By Jacques Gallant  Staff Reporter
10 September 2016

A Toronto real estate lawyer facing more than 500 criminal charges in relation to an alleged multimillion-dollar condo fraud is now the subject of discipline proceedings by the Law Society of Upper Canada.

Meerai Cho was first charged in 2014 with 75 counts of fraud over $5,000, possession of property obtained by crime and breach of trust. The charges relate to an alleged fraud where buyers lost $14.9 million in a North York condo building that was never built.

Another 426 charges were added in 2015 after more complainants came forward. None of the allegations has been proven in court. Cho’s next court date is Sept. 12.

“Neither Ms. Cho or I have any comments to make at this time out of respect for the processes at the Law Society and in the courts,” said Cho’s lawyer, William Trudell.

The criminal charges stem from Cho’s involvement with the developer of what was known as the Centrium project, who had planned to build a 14-storey hotel and 30-storey residential tower with commercial space on a lot at Yonge St. and Finch Ave.

According to a notice of application, filed at the Law Society Tribunal on Sept. 1, the legal regulatory body is alleging Cho transferred more than $13 million in deposits from buyers between 2010 and 2013 to her developer client “notwithstanding the fact, at the time, her client had no legal entitlement to the deposits.”

By doing so, Cho “knowingly assisted her client in dishonesty, fraud, crime or illegal conduct,” the Law Society alleges.

Retail and condo buyers said they gave Cho deposits for units, but were told by the developer in 2014 that plans for the building fell through. Cho reportedly promised the deposits would be returned, but buyers said she filed for bankruptcy shortly after. The lot was sold.

A Law Society discipline hearing date has not yet been set. The maximum penalty would be revocation of Cho’s licence to practice. Cho, who was released on bail in 2014, is already suspended from practising.

top
Lawyer in condo fraud sentenced to 3.5 years in jail
Law Times
By Jennifer Brown
23 February 2017

A Toronto lawyer who faced 75 charges of fraud in a case involving 140 condo investors has been sentenced to three-and-a-half years in prison.

Meerai Cho pleaded guilty in Ontario provincial court Wednesday to one count of criminal breach of trust and was sentenced on a joint submission with the Crown, according to her lawyer, William Trudell.

The matter was heard before Justice Jamie Chaffe at the 1000 Finch Avenue West court.

As Law Times reported in September 2014, Cho was arrested and faced 75 charges related to fraud over $5,000, possession of property obtained by fraud and breach of trust.  At that time, she said she transferred the condo purchasers’ deposit funds, which she was holding in trust, to her client who was the developer of a North York building. The transfer of the funds to the developer was contrary to the rules of the Condominium Act.

“What it came down to was a breach of trust — all the facts went into the one count as opposed to 75 counts,” Trudell says. “She didn’t set off to defraud anyone. She didn’t put any of the money in her own pocket.”

Cho claimed she transferred the money to the developer, Joseph Lee, through an “honest mistake” due to her inexperience.

Trudell says $13.5 million went through her trust account to the developer. The money came from purchasers of condo units in the Centrium condo project at 5220 Yonge Street in Toronto. The project had about 140 investors—at least 50 of them were in court on Wednesday.

“Unfortunately, she trusted him completely, unquestionably and he took off with all the money and is hiding somewhere,” Trudell told Legal Feeds.

As late as 2014, the developer would send Cho emails indicating he was sending her the money back.

“She kept feeding his demands to save the project and continued to do that because she thought he was going to send the money back and the project would work,” says Trudell.

At one point, Cho mortgaged her own home and gave $400,000 of her money to try and save the condo project.

Trudell says Cho received none of the money and that was a significant factor in the court not ordering restitution.

“If you get the fruits of the crime, then obviously restitution is appropriate, but in this case, because she got nothing, she has nothing and chances of repaying it are negligible and she was receiving a penitentiary sentence on the scale of large-scale fraud,” he says.

Cho stopped practising law and agreed to temporary suspension of her licence in 2014 and will now lose her right to practise.

Trudell described it as an “emotional day in court” as seven people read victim impact statements.

“The victim impact statements were raw and emotional,” says Trudell. “They are people who are still angry, of course, but when they realize she got not one penny, people might look at her a little differently.”

Trudell said some victims have made applications to the Law Society of Upper Canada compensation fund and it is "anticipated the victims will be compensated."

In a statement, the LSUC said its Compensation Fund "will move as quickly as possible to provide claimants with any grants for which they may be eligible, on the basis of the lawyer’s dishonesty. The process is already underway and, if grants are approved by the Compensation Fund Committee, eligible claimants should begin receiving fund grants in the spring."

Cho’s guilty plea and the evidence provided will be used to complement the LSUC's own evidence during the law society hearing, which is currently scheduled for March 8, 2017.

There is no limit on the total number of grants paid in respect of an individual lawyer. The Compensation Fund has per claimant limit of $150,000 for losses resulting in the period between September 2010 and July 2013, when Cho transferred monies held in trust for the purchasers to the developer of the condominium project. Each claim is assessed on its own merits to ensure it conforms with the Law Society Act and the Compensation Fund Guidelines.

Claimants who have not already done so can contact the Compensation Fund at 416-947-3343 or 1-800-668-7380, ext. 3343 or via email at compfund@lsuc.on.ca.

Cho, originally a journalist in Korea, came to Canada and became a lawyer. Trudell says many of the victim impact statements came from people who also came to Canada to invest and lost everything.

“A lot of the victims said they had no faith in Canada and the justice system and legal system because lawyers are supposed to protect them,” says Trudell. “She [Cho] stood up, apologized to them and told them not to lose faith in the legal system . . . She said there are a lot of wonderful lawyers; don’t use me as an example.”

Cho will serve the sentence in a federal institution, likely Grand Valley Institution for Women in Kitchener, Ont.

Lawyers for the victims are also pursuing civil actions.

top
Law Society of Upper Canada v. Cho 2017
Law Society Tribunal
Hearing Division
Tribunal File No: LCN113/16
Date: 08 March 2017
Before: David A. Wright (chair)
Suzanne Clément
Jerry B. Udell

Summary:
Cho – Professional Misconduct – Findings and Penalty – Criminal Convictions – Breach of Trust – Failure to Provide Competent Service – Intent – Revocation – The Lawyer released funds that she held in trust, which had been deposited by 140 condominium purchasers, to her developer client – As a result, the purchasers lost a total of $13,000,000 – The Lawyer’s licence was revoked and she was ordered to repay the Compensation Fund to the extent possible.

Oral reasons for the decision
Introduction
David A. Wright (for the panel):– The Lawyer, Meerai Cho, was entrusted with the deposit money of over 140 condominium purchasers for units in a new building. The law required her to hold that money and not to release it except in specific circumstances. Contrary to the law, she released $13 million of purchasers’ money to the developer, her client, who stole it and appears to have taken it out of the country. Construction on the building never started.

Ms. Cho pled guilty to the criminal offence of breach of trust and is now in jail, sentenced to three and half years in federal penitentiary. Her plea to this offence means she has admitted that she had intent: in other words, that she either knew, was reckless, or was wilfully blind to the fact that she was participating in a fraud.

Today is about the consequences for Ms. Cho’s legal career. We find that her actions were professional misconduct: she knowingly participated in fraud and did not meet the standard of a reasonably competent lawyer. We order that her licence be revoked, effective immediately. That is the only appropriate penalty. Our reasons follow.

The victims
We want to start by talking about thevictims. With Ms. Cho’s help, the developer, Yo Sup (Joseph) Lee, stole deposits they had paid for units in a condominium building that was to be built on Yonge Street in Toronto. The amounts taken from individuals range from just under $20,000 to nearly $400,000. Most people lost between $50,000 and $100,000.

[Who are these people? Most are immigrants, largely from the Asian-Canadian community. Some were buying homes for their families, others were investing. Some were starting lives in Canada, some were starting families. Some were trying to start businesses in commercial parts of the building. All lost their hard-earned money. Their victim impact statements describe the consequences of the fraud, including significant personal trauma, impacts on lives and finances, and on their confidence in Canadian institutions and the legal profession.

Many of them are here today. We want to say to them that we recognize the pain they have experienced and continue to experience, and also that we know their journey with the Law Society is not over yet as the question of payment from the Law Society’s compensation fund still needs to be considered by the relevant committee. We have had you foremost in mind as we considered the appropriate findings and penalty for Ms. Cho.

The misconduct
We will explain briefly what Ms. Chodid wrong. Under s. 81 of the Ontario Condominium Act, SO 1998, c. 19, deposits for new condominiums must be held in trust, either by the declarant (the developer) or a solicitor. This money can only be released in specific circumstances, and does not belong to the developer. It is in trust.

Ms. Cho held funds in trust for a development called Centrium. Over a period of several years, between 2010 and 2013, Ms. Cho took money from the trust accounts over 90 times and sent it to Mr. Lee. He told her he needed the money to complete the project and would put the money back into trust later. He told her without the money the project might be in jeopardy. She says she wanted to help save the project and believed that he would put the money back.

When Ms. Cho did that, she did not meet the standard of a competent lawyer (contrary to Rule 2.01 of the Rules of Professional Conduct in effect before October 2014) because giving the funds to Mr. Lee was contrary to the Condominium Act and the terms of the trust. Even though he was her client, her job as a competent lawyer was not to do what he asked, but to follow the law. What she did went so far beyond what a lawyer should do that it brought the profession into disrepute.

She also committed a crime. She knew or suspected that there was fraud – this is what she admitted to in criminal court – but went ahead and sent Mr. Lee the money anyway. This was knowing participation in fraud (contrary to Rule 2.02(5) of the Rules of Professional Conduct in effect before October 2014).

top  contents  chapter  previous  next