{"id":947986,"date":"2026-10-27T09:34:14","date_gmt":"2026-10-27T09:34:14","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/947986\/"},"modified":"2026-10-27T09:34:14","modified_gmt":"2026-10-27T09:34:14","slug":"three-gta-law-firms-put-into-receivership-after-accusations-of-mishandling-millions-in-real-estate-funds","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/947986\/","title":{"rendered":"Three GTA law firms put into receivership after accusations of mishandling millions in real estate funds"},"content":{"rendered":"

Open this photo in gallery:<\/a><\/p>\n

A real estate sign is shown in Vaughan, Ont. In his ruling, Justice Dunphy said the mishandling of legal trust accounts during real estate transactions has been occurring ‘with distressing regularity.’Paige Taylor White\/The Canadian Press<\/p>\n

Three law firms in the Greater Toronto Area have been put into receivership after being accused of mishandling millions in client funds during real estate transactions \u2013 allegations that an Ontario Superior Court justice warned could be just \u201cthe tip of an iceberg.\u201d <\/p>\n

Justice Sean Dunphy issued an order last week appointing accounting firm Doane Grant Thornton LLP as the receiver to take control of Simran Law Professional Corp. of Brampton, Ont., and JP Mann Law Firm Professional Corp. of Mississauga. <\/p>\n

In his ruling, Justice Dunphy said the mishandling of legal trust accounts during real estate transactions has been occurring \u201cwith distressing regularity,\u201d and that \u201cif left unaddressed, represents an exceptionally grave attack on the profession of law at large and the integrity of our civil legal system.\u201d<\/p>\n

In a separate ruling on Friday, Justice Dunphy also issued an order to put RSG Law \u2013 the firm founded by former Liberal MP Rajvinder Grewal \u2013 under the control of receiver AlixPartners Advisory Inc. The firm has been facing mounting civil lawsuits alleging it was at the centre of a series of frauds against its own clients and their lenders. <\/p>\n

Mr. Grewal or RSG Law are named in more than 30 civil cases, many involving allegations of trust-account manipulation or mortgage fraud.<\/p>\n

\u201cI shall refrain from using more superlatives to describe the shocking scope of the fraud that has been laid in front of me in relation to the operation of that firm\u2019s trust account,\u201d Justice Dunphy wrote in Friday\u2019s court order. The allegations of fraud have not been proven in court.<\/p>\n

Mr. Grewal has not been suspended from working, but has agreed not to practice law while he awaits a disciplinary hearing at Ontario\u2019s Law Society Tribunal.<\/p>\n

Judge criticizes Law Society of Ontario\u2019s handling of alleged real estate trust fund misconduct<\/a><\/p>\n

A rash of similar cases where lawyers allegedly violated their client\u2019s trust and misappropriated their money have ignited a debate in the legal profession about how to ensure clients and the public are protected. <\/p>\n

\u201cLawyers themselves need to raise the bar, that\u2019s why we\u2019re self-regulated,\u201d said Joseph Berljawsky, managing partner of Property Law Firm CB LLP, one of the largest real estate law firms in the country.<\/p>\n

In his decision involving Simran Law, Justice Dunphy said there were 25 occasions since February where lawyer Simranjyot Kaur represented sellers in a real estate deal, while lawyer Jagpal Mann of JP Mann Law Firm acted for the purchasers. More than $18-million in mortgage funds from a variety of smaller lenders were paid into the lawyers\u2019 trust accounts, intended for paying out mortgages held by some of the country\u2019s largest banks. <\/p>\n

Instead, the money went missing. <\/p>\n

\u201cThis is NOT a \u2018one off\u2019 case of records having been inadequately maintained or sloppy ledger-keeping,\u201d Justice Dunphy wrote. \u201cNot one of the mortgages was in fact discharged with the mortgage advance proceeds. Solicitors\u2019 undertakings to discharge the mortgages were not honoured \u2026 None of the funds have been returned or accounted for.\u201d<\/p>\n

The application for a receiver to be appointed was brought by the title insurer in each of the transactions, FCT Insurance Company Ltd.<\/p>\n

FCT was also the title insurer in three civil cases where lenders sought to recover mishandled trust funds from Brampton lawyer Anil K. Sharma. In an Oct. 14 court order on those matters, Justice Dunphy issued a sharp rebuke to the Law Society of Ontario\u2019s handling of real estate fraud by lawyers.<\/p>\n

Former Liberal MP sued by father-in-law, who alleges mortgage fraud and forged signatures<\/a><\/p>\n

In Mr. Sharma\u2019s cases, almost $5-million was allegedly misappropriated in a similar manner to other recent cases: Mortgage funds were taken into his legal trust fund, but were not remitted to the intended recipients.<\/p>\n

In his order for Mr. Sharma\u2019s case, Justice Dunphy wrote he was \u201cshouting into the wind\u201d about the seriousness of recent alleged frauds and the need for swifter action from the law society\u2019s regulators or from any authority.<\/p>\n

The law society hasn\u2019t made any public announcements about professional sanctions against Mr. Sharma, Ms. Kaur or Mr. Mann. None of those lawyers responded to requests for comment. <\/p>\n

Mr. Grewal\u2019s lawyer, Simon Bieber of Adair Goldblatt Bieber LLP, said his client \u201csold his shares in RSG Law in 2023 and has not been in control of the trust account since then.\u201d<\/p>\n

In a statement, the law society said it had obtained a court order freezing Mr. Sharma\u2019s trust account and could not comment on its investigations. However, the society said it \u201chas been involved in the receivership applications and as part of the receiverships is taking steps to safeguard the solicitor-client privilege of all clients.\u201d <\/p>\n

Mr. Berljawsky has been pushing a series of reforms at the law society that would make trust-account abuse and mortgage fraud more difficult to commit \u2013 or at least would lead to speedier discovery. <\/p>\n

Requiring a second professional\u2019s signature (though not in the case of sole practitioners) for any trust-account transaction is a start, according to Mr. Berljawsky. But he said a more meaningful and pro-active step would be to make law firms send monthly reconciliation reports of their trust funds to the law society that could be checked against their bank account balances.<\/p>\n

In his view, the current system places too much trust in lawyers to make the right decisions, effectively creating an honour system and not a regulatory one. Mr. Berljawsky is warning that lawyers could find themselves cut out of the lucrative real estate market entirely if reforms can\u2019t restore the trust of the public and of financial institutions.<\/p>\n

\u201cWe need to come together … to make sure residential conveyancing is safer and better, or rightfully, we will lose our role in the process,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"Open this photo in gallery: A real estate sign is shown in Vaughan, Ont. In his ruling, Justice…\n","protected":false},"author":2,"featured_media":947987,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[901,888,902,879,877,903,45,49,48,876,895,896,891,878,875,46,549,295,894,887,914,880,881,893,889,890,884,904,885,909,910,912,907,911,905,908,882,898,899,714,897,906,865,61,900,892,886,883,913],"class_list":["post-947986","post","type-post","status-publish","format-standard","has-post-thumbnail","category-business","tag-alberta","tag-arts-news","tag-bc","tag-breaking-news","tag-breaking-news-video","tag-british-columbia","tag-business","tag-ca","tag-canada","tag-canada-news","tag-canada-sports","tag-canada-sports-news","tag-canada-trafficcanada-weather","tag-canadian-breaking-news","tag-canadian-news","tag-economy","tag-education","tag-environment","tag-federal-government","tag-foreign-news","tag-globe-and-mail","tag-globe-and-mail-breaking-news","tag-globe-and-mail-canada-news","tag-government","tag-life-news","tag-lifestyle","tag-local-news","tag-manitoba","tag-national-news","tag-new-brunswick","tag-newfoundland-and-labrador","tag-northwest-territories","tag-nova-scotia","tag-nunavut","tag-ontario","tag-pei","tag-photos","tag-political-news","tag-political-opinion","tag-politics","tag-politics-news","tag-quebec","tag-sports-news","tag-technology","tag-travel","tag-trudeau","tag-us-news","tag-world-news","tag-yukon"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/947986","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/comments?post=947986"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/posts\/947986\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media\/947987"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/media?parent=947986"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/categories?post=947986"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/ca\/wp-json\/wp\/v2\/tags?post=947986"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}