ALERT! Equipment Loan Fraud Scheme | May 2009

Ontario lawyers have recently been subjected to a new fraud scheme described in detail by Dan Pinnington of LawPro at http://www.slaw.ca/2009/05/11/warning-to-lawyers/ as:

“In all cases, a previously unknown client retained the lawyer to do an incorporation three or four weeks ago. The client presented realistic looking photo ID (a newer Ontario driver licence). The lawyer completed the requested work and the client paid in full for the incorporation (usually with cash).
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In the last week, the client returned to the firm asking the lawyer to act on an equipment purchase loan matter. Loan amounts are approximately $300,000 and the loan is to come from a Halifax or Montreal-based lender (there is someone answering the phone for the lender – we suspect the fraudster or an accomplice). The client is pushing to have the loan completed as quickly as possible. The loan proceeds are to go to a third-party corporation (not the client’s new corporation).”

CLIA insurance programs in Nova Scotia and Manitoba have also issued alerts to their insured members on learning of this scheme:
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• Nova Scotia: http://www.lians.ca/FraudAlert_May12-09.pdf
• Manitoba: http://www.lawsociety.mb.ca/index.htm

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