CBC News has learned exclusive details behind an alleged title fraud in January that led to 3 arrests.
It began as a typical phone call for Niroosan (Niro) Vivekanantharajah — someone who found him on Google, asking for his help in closing a home sale.
The Toronto real estate lawyer told CBC News he agreed to work with the clients, who were selling a home in Scarborough. He says they had all the required paperwork and good knowledge of the process.
“To be completely honest — they were perfect clients. They were really well prepared,” said Vivekanantharajah, who says they shared with him property tax documents, proof of a vacant home tax declaration and two pieces of identification: an Ontario driver’s licence and a permanent resident card. He checked the IDs over a virtual Zoom call, where the client held a driver’s licence up to her face. Photos were also submitted to his office for review.
But within the span of a few weeks, those clients would be arrested by Toronto police, accused of executing a sophisticated title fraud to sell a home that did not belong to them. It’s a series of events put in place largely by Vivekanantharajah, who became suspicious after a call from the bank.
“I guess I got lucky and I just went with my intuition, but it could have easily happened to me as well.”
Vivekanantharajah is sharing his story to alert others about just how easy it is for some to facilitate this kind of fraud. A common thread in every title fraud story that CBC News has covered is the use of fraudulent identification, such as an Ontario driver’s licence. Experts say the IDs are becoming more and more advanced — making it increasingly difficult to thwart this kind of fraud.
Vivekanantharajah’s suspicions began after the deal was closed. The single family detached home in Scarborough sold for $840,000 in a private sale and wasn’t listed on MLS — the platform used by real estate agents and brokers to share information about properties for sale. The proceeds were then transferred to the alleged fraudster’s account.
He says he received a call from the bank where the funds were being held asking for him to verify the identity of his client in order to release the money.
He says the bank employee flagged to him that the account was new, and that this was the first transaction. She also flagged a potential issue with the permanent resident card being used as an ID.
“I couldn’t get confirmation that it was fake. They just said ‘It’s potentially fake, but we’re not sure.'”
The employee told Vivekanantharajah that if he could verify the client’s identity, she would release the funds, but he said he wanted to be completely sure before doing that. So he and his associate made a plan and decided to play detective — by visiting the home that had been sold.
“We just winged it, to be honest.” he said. “We didn’t even think it was going to work at all.”
Vivekanantharajah says the home in question had mail piling up outside, which was the first red flag for him, then he noticed porch door was locked, so he couldn’t get in to ring the bell.
“So I’m like, ‘How do people knock on the door? How do they even get mail or deliveries?’ ”
He proceeded to knock on the doors of neighbouring homes, where he met people who gave vague descriptions of the residents that seemed to match the clients he was dealing with.
After he left the area, he received a phone call from the next door neighbour who’d taken one of his business cards. The woman told him the owners were away in China and that she had the keys to the home.
“The second I told her, I’m like: ‘Ma’am, I sold this house,’ and she’s like, ‘What do you mean you sold the house?’ I’m like, ‘It’s gone.’ “
The neighbours made contact with the homeowners, and Vivekanantharajah was able to confirm that his clients weren’t the true owners.
Vivekanantharajah, who also practices criminal law, says he alerted the bank to the alleged fraud, and the bank contacted police. He says they worked together to orchestrate a sting operation, which involved getting the alleged fraudsters to the bank in person.
He says he instructed the clients to go to a specific branch in Aurora, Ont., where a plainclothes officer was waiting for them.
“I knew they were desperate enough to go there and it pretty much sold — they went there,” said Vivekanantharajah.
Toronto police confirmed the Jan. 27 arrest of three suspects — Xue Wang, Ling Pan and Xing Yu Ling — who are now facing a charge of fraud over $5,000. Wang is also facing charges of possession proceeds obtained by crime over $5,000, launder proceeds of crime, personation with intent to obtain property and utter forged document.
Both the real owners and purchasers of the Scarborough home had title insurance, and Vivekanantharajah says the buyers — who were investors — have received the funds they paid for the home back. The owners, he says, are working on having their name restored to the home’s title.
Sophisticated fake IDs
In the recent cases of title fraud CBC News has reported on, a fake ID has been used by the alleged fraudsters — either posing as a renter to obtain access to the home or as the homeowner themselves.
In this case, the photographs on the IDs matched the alleged fraudsters, but the names and addresses matched the true homeowners.
The difficulty, according to experts, is that these types of fake IDs are only becoming more and more advanced.
“It is absolutely incredible how these IDs are identical replicas of an original,” said Daniela DeTommaso, the president of FCT Insurance, one of Canada’s four title insurance companies. She is tasked with remediating title fraud.
The trouble, she says, is that in many cases, even if someone checks the driver’s licence number using the province’s free online checker, it can come back as valid.
“In most of the frauds that we’re seeing the driver’s licence is in fact active, it just does not belong to the person that it’s supposed to belong to,” said DeTommaso.
“Throughout the COVID pandemic we saw an explosion in frauds using what I call synthetic IDs,” said Det. Const. John Armit with the anti-rackets branch of the Ontario Provincial Police (OPP).
He says while much of that growth included fake IDs used in fraud involving CERB and auto-financing, they are popping up in real estate fraud.
“They have devices like printers and they use card stock and they create a fake identification,” he said.
“We’ve also seen through our investigations that these fraudsters will have perhaps a hologram or features that would be included in various different government identifications.”
The problem is, once a fraudster has a good fake ID, Armit says it can allow them access to other personal information or documents.
“Once you receive someone’s compromised identification, the floodgates are open and the opportunities are there for them to get credit cards or get credit.”
While Vivekanantharajah is being commended by DeTommaso and Armit for his actions, the alleged fraud still doesn’t sit well with him.
“I took it to heart because I think I’m a decent real estate lawyer — to the point where I actually train lawyers. So I didn’t like that it happened to me.”
He says he worked as a bouncer for years before becoming a lawyer, and with that he’s even more surprised he wasn’t able to catch the forgery. He says he doesn’t blame other lawyers who would have gone along with releasing the funds.
“So imagine: my job is to check ID on the regular for 11 years, and then even as a lawyer … I still didn’t catch it.”
The three suspects, Xue Wang, Ling Pan and Xing Yu Ling, are set to appear in court on March 24.
This article was originally sourced from www.CBCnews.ca