March 21, 2025
FSRA takes action against former mortgage agent for brokering loans linked to imposters.
Ontario’s financial watchdog has issued a $145,000 penalty against former mortgage agent Yujun (Janet) Shi for arranging fraudulent mortgage transactions and brokering loans outside of her registered brokerage.
The Financial Services Regulatory Authority of Ontario (FSRA) found that Shi engaged in unauthorized mortgage dealings, accepted illegal compensation, and was involved in a scheme where imposters posed as homeowners to secure fraudulent loans.
Shi, who was previously licensed under The Mortgage Alliance Company of Canada Inc., brokered at least 10 mortgage transactions outside her brokerage between January and June 2021, generating over $9 million in mortgage proceeds. She collected nearly $130,000 in commissions and fees from these deals, violating Ontario’s mortgage regulations.
FSRA determined that nine of the 10 mortgages brokered by Shi involved fraudulent borrowers. The regulator highlighted red flags in her transactions, including her failure to meet borrowers in person, funds being wired to multiple bank accounts in China, and mortgage proceeds being received by an individual unrelated to the borrower.
FSRA ruled that Shi “ought to have known that she was being used to facilitate dishonesty, fraud, crime, or illegal conduct.”
Her case is part of a broader mortgage fraud scheme linked to Yuansen (Eric) Fu, who is wanted by police and believed to be living in China. Fu allegedly orchestrated an operation in which imposters used falsified documents to pose as homeowners, secure fraudulent mortgages, and pocket the loan proceeds.
Shi is not the only industry professional implicated in the scheme. Former mortgage agent Lin Liang was fined $440,000 for brokering fraudulent loans totaling $17.9 million, collecting more than $1 million in fees. Another mortgage agent, Yu (Jade) Wang, was fined $10,000 for brokering a fraudulent mortgage while unlicensed.
The fraudulent transactions resulted in over $8.5 million in mortgage proceeds. In at least one case, a lender suffered direct losses of $1.1 million due to a transaction brokered by Shi that was not covered by title insurance.
FSRA emphasized that mortgage professionals have a responsibility to prevent fraud and ensure they are not enabling criminal activity, whether knowingly or unknowingly. The regulator stated that Shi’s actions deprived clients of the consumer protections provided under Ontario’s mortgage laws and led to financial harm for lenders and title insurers.
“Mortgage fraud damages the integrity of the industry and leads to increased costs for everyone, including lenders and consumers,” FSRA said in its notice of proposal.
Despite title insurers covering many of the fraudulent claims, FSRA noted that some lenders still faced significant financial losses.
Courtesy of mpamag.com – March 18, 2025
