Ontario lawyer suspended by law society for using trust funds to pay for hookers and drugs

Supported By:

Net Patrol International Inc.  Data Investigation and Forensic Services
Bankruptcy and Insolvency Trustees

Toronto (December 3, 2020) – The Law Society of Ontario (LSO) suspended personal injury lawyer, Darren Deenosan Kirupa, after a tribunal found that he likely mishandled and misappropriated trust funds, failed to keep appropriate books and records as well as has been untruthful with the LSO. Medical evidence showed that the 32-year-old is suffering from serious psychiatric and substance abuse disorders. According to a forensic audit, Kirupa used the money to pay for his illegal drug habit and escort services. Kirupa did not oppose the order requested. On November 11, the LSO suspended his license on an interlocutory basis.

The Law Society of Ontario (LSO) has obtained a suspension order against personal injury lawyer, Darren Deenosan Kirupa, according to the reasons of an LSO tribunal issued on November 11. The tribunal found that he likely mishandled and misappropriated trust funds to pay for his drug addiction and escort services.

Motion for interlocutory suspension

Kirupa was called to the bar in 2012. He was a sole practitioner specialized in personal injury practices. According to the LSO, he handled about 100 files and employed a law clerk and two articling students, at the height of his practice. But by the end of 2019, he no longer had employees, had left his shared office space, and was winding down his practice. In January 2020, the Lawyer was living at home with his parents, who were becoming increasingly concerned about his mental health.

On February 7, the Law Society received information suggesting that Kirupa ‘might be or might have been incapacitated and might have engaged in professional misconduct.’ The investigation started the same day that later lead to LSO’s motion for interlocutory suspension.

Kirupa’s capacity – serious psychiatric and substance abuse disorders

On January 10, the police were called, and Kirupa was arrested and finally hospitalized for serious mental health issues, according to the medical health evidence. He remained hospitalized until March 31 – 80 days later. Documents from his hospitalization show that Kirupa had a significant history of substance abuse and suffered from a psychiatric disorder and that treatment likely needed to remain indefinite. The treating psychiatrists opined that the Lawyer’s condition could be stabilized, but that he required ongoing treatment.

However, Kirupa is currently not engaged in any therapeutic regime and has refused any further treatment, or counseling, or addiction therapy to address his psychiatric and substance abuse disorders, which he pointed out repeatedly during the LSO’s investigation. On April 30, he wrote to the LSO that he is capable of practicing law.

Hospitalization due to the impression that he posed a danger to himself or others

During his hospitalization, the Tribunal found that Kirupa was dishonest about his handling of legal and financial matters while hospitalized despite being instructed to refrain from doing so.

The 32-year-old had managed to have his drug dealer deliver drugs to him while in hospital. The hospital notes also indicate that he was fairly defiant, basically doing what he wanted to, despite hospital rules and his own promises not to engage in certain behaviors.

The treating psychiatrist directed Kirupa, on multiple occasions, not to engage in the practice of law while in hospital. He was specifically advised not to practice law, not to have any dealings with financial instruments nor trust funds, not to interact with clients regarding any legal matters nor provide any legal representation while at the hospital. Kirupa indicated he would follow this advice.

Nevertheless, he was observed bringing client files from work to the hospital after being out on a pass. Additionally, while on a pass and away from the hospital, he contacted various lawyers and brought yellow legal pads and pens into his hospital room.

The LSO’s investigation

Kirupa had already been audited by the LSO in 2018. That audit showed that the trust account had been, at times, in deficit and was being used contrary to the By-Laws, according to the LSO. In January 2020, the Spot Audit department of the LSO contacted Kirupa to re-audit his books and records. He replied that he had been hospitalized and could not provide the financial documentation requested.

After being discharged from the hospital, Kirupa returned to practice, and failed to provide information to the LSO showing that he had corrected the previously identified deficiencies. The LSO said that he claimed that his trust account was never ‘impaired’ but provided no evidence to support this.

During the investigation, he admitted in an interview on April 9 that he wanted to become a professional poker player and admitted to almost daily abuse of illegal drugs during the three years prior to his hospitalization. On April 26, he wrote to the LSO investigator that the balance of his trust account was zero and that he did not take drugs when he practiced law, and that he funded his drug use from his income.

The forensic audit revealed transfers from trust funds to escort services and drug dealers

Between June and August of this year, the LSO conducted a forensic audit. The forensic auditor found many inappropriate transactions, including misappropriation, pre-taking from the trust, and also a number of transactions where third parties, with no connection to Kirupa’s clients or the legal matters he was dealing with, were paid monies directly out of the trust. According to the hearing records, the recipients of these funds were individuals allegedly trafficking illicit drugs and various adult escort services.

The forensic audit showed that Kirupa had made payments directly to his credit card via transfers from his trust account. The trust bank statements indicated that the lawyer also removed cash directly from his trust account. The general account for the period of September 1, 2019, to April 30, 2020, shows multiple e-transfers to escort services and drug dealers who received funds from the trust account.

The tribunal

The tribunal hearing regarding the LSO’s motion for interlocutory suspension was held by videoconference on October 7. Kirupa did not oppose the order requested.

The LSO argued that the medical evidence provides reasonable grounds to believe that, in these circumstances, Kirupa may lack capacity to practice and may pose a risk to the public should he continue to refuse medical treatment or fail to follow the recommendations of his treating medical professionals.

Furthermore, the tribunal was certain that the evidence showed that Kirupa has likely mishandled and misappropriated trust funds, which included personal injury settlements, to pay for illegal drugs and various escort services. The LSO’s reasons pointed out that the trust funds were ‘payable to vulnerable members of the public who have a demonstrated financial need and are entitled to collect those funds.’

Additionally, the LSO found that Kirupa had been untruthful multiple times during the LSO’s investigation, including his consumption of illegal drugs, about the trust account and funds, about his future career plans, etc.

The LSO concluded that his misconduct demonstrates a serious lack of integrity and poses a significant risk to the members of the public and the public interest in the administration of justice. Therefore, they suspended his license on an interlocutory basis.

Read more: Appeal court holds up sentence against disbarred lawyer for business loan frauds