LAW SOCIETY TRIBUNAL
HEARING DIVISION
Tribunal File No.: 25H-084
BETWEEN:
Law Society of Ontario
Applicant
- and -
Courtney Donovan Fraser
Respondent
Before: Lubomir Poliacik (chair), Shalini Konanur, Michelle Richards
Heard: January 28-29, 2026, by videoconference
Appearances:
Kristin Bailey, for the applicant
Respondent, self-represented
Summary:
FRASER – Using Trust Account for Purposes Unrelated to the Practice of Law – Crypto Currency Conversion – The Law Society alleged that the Lawyer used his trust account for purposes not related to the provision of legal services – The Lawyer admitted that he received the funds in his trust account but did so inadvertently – The panel noted that this position did not align with the evidence before it – The panel concluded that the Lawyer had engaged in professional misconduct as alleged and ordered a two-month suspension and an enrollment in a practice management program – The parties were invited to make written submissions on costs.
REASONS FOR DECISION
1Lubomir Poliacik (for the panel):– In this conduct application, Courtney Donovan Fraser is alleged to have engaged in professional misconduct by using his trust account to convert cryptocurrency to Canadian currency for three individuals without having provided legal services, in contravention of Rule 3.2-7.3 of the Rules of Professional Conduct.
2While Mr. Fraser admitted that funds were received into and disbursed from his trust account for purposes not related to the provision of legal services, he takes the position that the deposits to his trust account were made inadvertently and therefore do not constitute professional misconduct.
3After hearing the evidence, the panel found that the Law Society established professional misconduct as alleged in the notice of application. Following the parties’ submissions, we reserved our decision on penalty.
4For the reasons that follow, we order that Mr. Fraser’s licence to practise law be suspended for a period of two months.
THE EVIDENCE
5We received evidence by way of a request to admit (RTA) and Mr. Fraser’s response thereto; the documents appended to the RTA; and Mr. Fraser’s oral evidence.
Preliminary issue
6A preliminary issue arose as to the admissibility of additional evidence sought to be introduced by the Law Society. Mr. Fraser objected to the evidence as it was provided to him less than 20 days prior to the commencement of the hearing, as required by Rule 10.5 of the Tribunal’s Rules of Practice and Procedure.
7Some of that evidence was provided by Mr. Fraser to the Law Society’s investigator in a telephone interview and in written representations two weeks earlier, in a separate investigation.
8While the Law Society submits that the new evidence goes only to penalty considerations, we found that allowing the evidence would nevertheless result in insurmountable prejudice to Mr. Fraser. Mr. Fraser’s objection to the admissibility of the new evidence was sustained.
9Adjournment was not appropriate relief in the circumstances of this case, where on January 19, 2026, a mere 10 days before this hearing, the Law Society’s request for an adjournment to allow for the consolidation of the new investigation with this application was rejected by the proceedings management conference panelist.
THE FACTS
10Most of the facts in this case are not in dispute.
Lawyer’s background
11Mr. Fraser was born in 1988, was licensed as a paralegal in Ontario in 2011, and was licensed as a lawyer in Ontario in 2022.
12Mr. Fraser practises as a sole practitioner in Brampton, Ontario, primarily in corporate commercial law (approximately 65% of his practice). He also practises in civil litigation and criminal law.
13Mr. Fraser was the subject of a spot audit on August 30, 2024. The allegation of misconduct arose from the review of Mr. Fraser’s books and records during this audit.
The Transactions
JY Transactions
14EM retained Mr. Fraser in the fall of 2022 to draft a settlement agreement and release between himself and GY and JY. Mr. Fraser had represented EM in unrelated matters prior to 2022.
15EM informed Mr. Fraser that he had promoted an investment opportunity in cryptocurrency companies owned by an American named Neil Chandran to individuals including GY and JY. Mr. Chandran had subsequently been criminally charged with a $45 million fraud involving investments in these companies. EM informed Mr. Fraser that GY and JY lost their investment.
16EM informed Mr. Fraser that despite having no legal obligation to do so, he wanted to pay a settlement sum of 89,000 USDC, a type of cryptocurrency which was worth $89,000 USD, to GY and JY. EM informed Mr. Fraser that the funds came from investments during the “crypto boom during COVID”. Mr. Fraser understood that EM wanted to have the funds flow through Mr. Fraser’s cryptocurrency wallet as a “buffer.”
17Mr. Fraser drafted a settlement agreement and release for EM, which was executed by all parties on October 17, 2022, and provided that the payment to GY and JY would be made by transfer from Mr. Fraser’s crypto wallet.
18In addition to the payment of 89,000 USDC by EM and confidentiality and non-admission of liability clauses, the settlement agreement and release included the following terms, requiring GY and JY:
- to not share any contact information or coordinates regarding EM, including, but not limited to, telephone numbers, mailing addresses, email addresses, social media profiles, GPS coordinates, etc. with any third parties;
- to delete and/or retract any negative statements published online regarding EM where they are able to do so;
- not to encourage, persuade, incentivize, or coerce any individuals to publish negative, damaging, or defaming statements online regarding EM;
- if any negative, damaging, or defaming statements published on the internet are discovered, including any social media platform, regarding EM made by third parties, where they are able to do so, GY and JY will make all effort to direct, instruct, and encourage the authors to remove such statements, content, and/or materials;
- not to intimidate or threaten EM to assist with any prosecution procedures nor civil claims.
19The settlement funds were paid from EM’s cryptocurrency wallet to Mr. Fraser’s cryptocurrency wallet, then forwarded to a cryptocurrency wallet maintained by GY and JY within 30 days of the execution of the settlement agreement and release.
20On June 21, 2024, JY emailed Mr. Fraser stating that the settlement funds were still in his cryptocurrency wallet because he does not know how to transfer the funds to his bank account. In this email, JY stated, “I remember you saying that you do it, for a fee. What is your fee? We are possibly interested in using you to help us with this.” Mr. Fraser agreed to assist JY.
21On June 27, 2024, JY transferred 89,000 USDC to Mr. Fraser’s cryptocurrency wallet.
22Between June 27, 2024 and July 2, 2024, Mr. Fraser converted the USDC to Canadian currency and placed it into his trust account using the cryptocurrency platform VirgoCX. This involved 15 separate deposits to Mr. Fraser’s trust account from his crypto wallet, ranging from $5,000 to $10,000 each, totalling $120,306.58. The June-July 2024 monthly RBC statement for Mr. Fraser’s trust account describes each of these deposits as “e-Transfer - Autodeposit VirgoCX”.
23On July 3, 2024, Mr. Fraser transferred the funds from his trust account to JY’s bank account, minus his fee of $1,754.06.
24Mr. Fraser admits that the funds involved in the 2024 transactions were not related to the provision of legal services.
AM Transactions
25On July 25, 2024, Mr. Fraser received $303.23 in his trust account from VirgoCX.
26AM, a friend of Mr. Fraser, had transferred funds into Mr. Fraser’s cryptocurrency wallet. Mr. Fraser converted these funds into Canadian currency using the VirgoCX platform and the funds were deposited into his trust account.
27The same day, AM also sent an e-transfer for $270 into Mr. Fraser’s trust account.
28The next day, July 26, 2024, Mr. Fraser paid AM’s Rogers Wireless bill by online payment directly from his trust account.
29Mr. Fraser admits that these funds were not related to the provision of legal services.
Konadu Transactions
30On October 2, 2024, Mr. Fraser received $8,810.67 in his trust account from VirgoCX. Mr. Fraser told the Law Society that his wife, Doreen Konadu, owned a business called Bronze Beauty Vault. That business had transferred these funds into Mr. Fraser’s cryptocurrency wallet, Mr. Fraser converted these funds into Canadian currency using the VirgoCX platform and placed the funds into his trust account.
31Mr. Fraser transferred the funds from his trust account to his general account on October 3, 2024. He disbursed $4,000 to Ms. Konadu from his general account on the same day.
32Mr. Fraser told the Law Society that the remaining funds were disbursed to Ms. Konadu from his general account over the following weeks.
33Ms. Konadu also sent an e-transfer to Mr. Fraser’s trust account for $55 on September 23, 2024 and another for $114 on October 2, 2024.
34Mr. Fraser admits that these funds were not related to the provision of legal services.
Mr. Fraser’s explanation of the transactions
35In his testimony and submissions before us, Mr. Fraser took the position that the transfers of the funds to his trust account were inadvertent, that he did not intend to transfer the funds to his trust account but rather the transfers were an artifact of the VirgoCX platform.
36When he created the VirgoCX account, Mr. Fraser used the email address he uses for professional financial correspondence.
37At the time, Mr. Fraser understood the email address to function as a login and identification credential, not as a permanent routing mechanism for withdrawals.
38He believed based on his experience with conventional financial platforms that he would be able to select or confirm the destination account at the withdrawal stage. That assumption was wrong. The VirgoCX platform routed all withdrawals from Mr. Fraser’s crypto wallet directly to his trust account.
The JY Deposits
39Mr. Fraser testified that when JY’s funds were converted to Canadian currency and the withdrawals began from his wallet on the VirgoCX platform, he did not initially realize that the destination account was his trust account and only became aware that funds were being deposited to his trust account after he started receiving electronic transfer notifications.
40Once he realized that the funds were being routed to trust, Mr. Fraser says that he acted promptly. He did not leave the funds sitting in trust but removed them as soon as practical.
41Mr. Fraser points to the fact that it all happened over a weekend and that due to the nature of cryptocurrency, he could not reverse the transactions.
42However, this does not explain why Mr. Fraser repeated the withdrawals over a period of seven days. Mr. Fraser testified that he received notification of each deposit to his trust account within 24 hours. That means that he knew that the funds converted to Canadian currency on the VirgoCX platform were being transferred from his crypto wallet to his RBC trust account on June 28 at the latest. But he continued to convert the funds over the next five days, until July 2, when the last of JY’s cryptocurrency was converted and deposited to Mr. Fraser’s trust account.
43Mr. Fraser’s position at this hearing, that the 15 separate deposits of JY’s funds to his trust account were inadvertent and unintentional, is also inconsistent with the position he took during the Law Society’s investigation. Neither in his interview with the investigators nor in his written representations to the Law Society did Mr. Fraser advise that these funds were deposited to his trust account through inadvertence or unintentionally. To the contrary, Mr. Fraser went to some lengths in his efforts to convince the investigators that he reasonably believed at the time of the transactions that he received JY’s funds in the course of providing legal services.
The AM Deposits
44Mr. Fraser testified that he originally provided his VirgoCX wallet information to AM in contemplation of being retained for legal services as AM wished to pay his retainer in cryptocurrency. It turned out AM did not need to use Mr. Fraser’s crypto wallet for a retainer.
45Instead, on July 25, 2024, AM transferred the equivalent of $303.23 in cryptocurrency to Mr. Fraser’s wallet, without providing any prior notice to Mr. Fraser. AM then e-transferred an additional $270 to Mr. Fraser’s email address, which was auto-deposited to Mr. Fraser’s trust account, also without prior notice to Mr. Fraser. AM then advised Mr. Fraser that he wished Mr. Fraser to use the funds to pay AM’s outstanding Rogers Wireless bill.
46Mr. Fraser could have transferred AM’s crypto currency to another wallet which was not associated with his trust account. Instead, Mr. Fraser converted the cryptocurrency in his wallet on the VirgoCX platform to Canadian currency and withdrew the funds, which resulted in the $303.23 being auto deposited to his trust account. And the next day Mr. Fraser paid AM’s Rogers bill directly from his trust account.
47Mr. Fraser testified that he did not request AM to make these deposits to his crypto wallet or his trust account and that therefore the deposits were made inadvertently on his part and do not constitute professional misconduct.
48Yet, the fact is that when Mr. Fraser converted AM’s cryptocurrency to Canadian dollars in his wallet, and withdrew the funds, he must have known that these funds would be routed to his trust account. The AM deposit occurred only a few weeks after the JY transactions. Further, having setup and authorized auto-deposit for e-transfers to his trust account, it is disingenuous for Mr. Fraser to then take the position that a deposit to the trust account by a third party were done without his knowledge or approval.
49Mr. Fraser testified that after the JY transaction in June-July 2024, he opened a separate cryptocurrency wallet which was not associated with his trust account. No explanation is proffered by Mr. Fraser as to why he did not transfer the crypto currency he received from AM to that wallet prior to converting those funds to Canadian currency and withdrawing them.
The Konadu Deposit
50Mr. Fraser testified that the deposit of $8,810.67 to his trust account on October 2, 2024, also “took place inadvertently”.
51Mr. Fraser’s wife’s business had transferred cryptocurrency to his wallet on the VirgoCX platform. Mr. Fraser converted the funds to Canadian currency and withdrew the money, again resulting in those funds being deposited to his trust account.
52This purported inadvertence took place after the 15 separate allegedly unintentional deposits of the YJ funds and the AM deposit to the trust account from the VirgoCX platform.
53And again, no explanation is proffered by Mr. Fraser why he did not transfer the crypto currency he received from his wife’s business to the wallet not associated with his trust account prior to converting those funds to Canadian currency and withdrawing them.
FINDING
54Mr. Fraser submits that these transactions were “inadvertent routing of funds through trust caused by unfamiliar technology and followed by immediate correction” and do not constitute professional misconduct. By “correction” Mr. Fraser means that he withdrew the funds from his trust account as soon as practicable after they were deposited.
55There are scenarios where a trust account deposit and withdrawal of funds unrelated to the provision of legal services may not constitute professional misconduct. For example, when a bank, through its own error, mistakenly deposits funds into a licensee’s trust account. But that is not the case here. Mr. Fraser set up his cryptocurrency wallet in a manner that resulted in all withdrawals from that wallet being routed directly to his trust account. Not only did he not correct or close the wallet once he discovered that this is the case, he continued to use the wallet, resulting in multiple deposits of funds unrelated to the practise of law to his trust account. The funds were deposited to Mr. Fraser’s trust account because of his actions.
56We conclude that the professional misconduct as alleged in the notice of application is established in relation to the JY, AM, and Konadu trust account transactions.
PENALTY
57The Law Society submits that a six-month suspension of Mr. Fraser’s license is the appropriate penalty. Mr. Fraser proposes a conversion of this application to an invitation to attend (ITA) under s 36(1) of the Law Society Act, RSO 1990, c L.8 (the Act), or, in the alternative, a reprimand.
Is an ITA warranted?
58If Mr. Fraser’s motion to convert this proceeding to an ITA is granted, the Tribunal order will provide that the application is dismissed following an ITA.
59An ITA is appropriate only in exceptional circumstances which fall into two broad categories. The first is where the licensee’s actions were somehow beyond his control. For instance, the conduct may be caused by personal circumstances that are covered by the Ontario Human Rights Code. The second comprises circumstances that change the complexion of the case from what was originally authorized and lead to significantly reduced likelihood of harm to the public interest.1
60Mr. Fraser submits that this application should be converted to an ITA because the use of his trust account for purposes unrelated to the provision of legal services was not serious and was “unintentional”.
61We found, as set out above in these reasons, that Mr. Fraser set up his cryptocurrency wallet in a manner that resulted in all withdrawals from that wallet being routed directly to his trust account. He failed to correct the issue or to close the wallet once he discovered that this is the case and continued to use the wallet. We find this does not fall within the category of exceptional circumstances where the licensee’s actions were in some fashion beyond their control as contemplated in the Tribunal’s jurisprudence.
62Only the least serious cases are candidates for an invitation to attend. We find, for reasons elaborated below, that Mr. Fraser’s misconduct was significant and not of the least serious category.
63Consequently, we dismiss the motion to convert this application to an ITA and proceed to consideration of the appropriate penalty.
Penalty factors considered
64The purposes of penalty orders are specific deterrence, general deterrence, rehabilitation, and maintenance of public confidence in the legal professions.2
65In arriving at an appropriate penalty, considering these purposes, we consider the non-exhaustive list of factors articulated in Law Society of Upper Canada v Aguirre, 2007 ONLSHP 46.
Factors related to the misconduct
The nature of the misconduct
66The first of these factors is the nature, extent and duration of the misconduct. The vast gulf separating the six-month penalty proposed by the Law Society and Mr. Fraser’s request for conversion of this application to an ITA or reprimand stems principally from the parties’ divergent views of how this factor applies to Mr. Fraser’s misconduct.
67The Law Society submits that Mr. Fraser’s misconduct was serious and relies in large part on the decision in Law Society of Ontario v Albaum, 2023 ONLSTH 156.
68In Albaum the Chair reviews the rationale behind Rule 3.2-7.3:
17Rule 3.2-7.3 provides that “A lawyer shall not use their trust account for purposes not related to the provision of legal services.”
18Section 18 of By-Law 9 requires that every licensee is required to maintain financial records including a book of original entry that identifies the purpose for which trust money is received.
19These professional obligations were adopted in 2013 to address two principal concerns, namely:
- The use of lawyers’ trust accounts to shield unsavoury financial dealings from scrutiny.
- The use of trust accounts to lend legitimacy to dubious or fraudulent investment schemes.
20Rule 3.2-7.3 is an important way by which Law Society regulation helps to ensure that trust accounts are not used for money laundering and other dishonest purposes and that lawyers’ trust accounts continue not to be subject to government scrutiny.
21Rule 3.2-7.3 bars the use of trust accounts for purposes not related to the provision of legal services. It does not matter whether those purposes are dishonest, benign or entirely positive. As a result, it was not necessary to reach a conclusion as to [Mr. Albaum’s clients’] purpose for using Mr. Albaum’s trust account in order to find breach of Rule 3.2-7.3.
22As Ms. Kert put it in Law Society of Ontario v. Nesker, 2022 ONLSTH 152 at para. 28:
Lawyers and paralegals are in a unique position of trust. Their activities on behalf of their clients, including activities within their trust accounts, are protected by solicitor-client privilege and largely shielded from government intervention. It is for this reason, and to guard against the potential misuse of their trust accounts, that licensees are required to provide legal services in connection with the monies that move in and out of their trust accounts.
23In our view, Rule 3.2-7.3 can be seen as a rule in aid of risk management. There is a risk of lawyers’ trust accounts being used to shield unsavoury financial dealings from scrutiny. This risk is reduced by prohibiting the use of trust funds for purposes not related to the provision of legal services.
69There can be more serious and less serious breaches of Rule 3.2-7.3 depending on the context:
27Given the purpose of the Rule 3.2-7.3, there are a range of contexts in which a breach can occur. For example, if a lawyer was helping to organize a neighbourhood event and used their trust account to receive contributions from their neighbours, that would be a breach of Rule 3.2-7.3 despite the purpose of the use being socially positive.
28At the other end of the spectrum, a lawyer could have actual or constructive knowledge that the purpose of the use of the trust account was dishonest.
30There can be examples in between these two extremes. A lawyer could use a trust account without specifically knowing the client’s purpose but without having any reason to suspect an improper purpose. This would be a breach of the Rule 3.2-7 and of By-Law 9. This would be a more serious breach than the pro-social use described above and less serious than use for a known dishonest purpose.
31Further along the spectrum would be a case in which the purpose is not actually or constructively known but where there is reason to be concerned about the propriety of the purpose. This is like the prior example in that the actual purpose is not known but is more serious in that there is an elevated risk of an improper purpose.
32Taking into account the purpose of the rule, we consider the breach to be more serious where the lawyer does not know that the purpose is benign or positive, and even more serious where the lawyer has reason to suspect that the purpose is neither benign nor positive, but continues to allow their trust account to be used for purposes other than the provision of legal services.
33Rule 3.2-7 is designed to guard against the risk of misuse of trust accounts. It follows that a failure to make a reasonable inquiry as to the purpose of the use makes the breach more serious both because the risk of misuse is greater, absent inquiry, and because of the By-Law 9 requirement that the purpose be recorded. It further follows that allowing use for a suspicious purpose is more serious because there is a greater risk of misuse. In other words, the misconduct of a lawyer who allows a use where there are grounds to be concerned about misuse is more serious. We find that this is the situation here.
70The panel in Albaum ordered a nine-month suspension of license.
71As set out in Albaum, there is a spectrum, a ladder of four rungs of misconduct, escalating in gravity, from the least to the most serious, where a lawyer’s use of their trust account for purposes unrelated to providing legal services in breach of the Rule 3.2-7.3 can be categorized:
- Where the use of the trust account has a socially positive purpose (such as helping to organize a neighbourhood event and to receive contributions from their neighbours).
- Where the lawyer uses a trust account without specifically knowing the client’s purpose but without having any reason to suspect an improper purpose.
- Where the purpose is not actually or constructively known but where there is reason to be concerned about the propriety of the purpose.
- Where the lawyer has actual or constructive knowledge that the purpose of the use of the trust account was dishonest.
72This is of course a general categorization, and cases may not fall neatly into only one of the rungs, but it is nevertheless a very useful tool for assessing the seriousness of the breach of Rule 3.2-7.3 in determining the appropriate penalty.
73The presence, or the lack of, red flags is one of the means by which a panel may assess the seriousness of the breach of the rule and its place on the ladder of seriousness.
Red flags in the JY transaction
74The Law Society submits that Mr. Fraser’s misconduct falls within the third rung of seriousness, the same as the misconduct found in Albaum, because there were red flags regarding the JY transaction, which should have raised concerns for Mr. Fraser about the propriety of the transaction.
75The Law Society submits that there were red flags indicating that the settlement funds may have been related to some unlawful or dishonest activity, fraud or money laundering, and that this is “at the upper end in the red flags”.
76The Law Society points to the fact that EM advised Mr. Fraser that he had no legal obligation to pay GY and JY. According to Mr. Fraser, GY’s and JY’s claims were statute-barred. The Law Society states this means that there was no commercially justifiable purpose for the release sought by EM, or for the payment by EM to GY and JY. It states that a voluntary payment of funds with no legal requirement to do so is a red flag for money laundering.
77We do not agree. It is not unusual for a party to take the position that they have no responsibility or liability for another person’s loss and nevertheless make a settlement payment and seek a formal release.
78The Law Society is on more solid ground in its submission that the nature of the transactions that gave rise to the settlement agreement and release sought by EM and the terms of the document itself constitute red flags that should have alerted Mr. Fraser to the possibly of the improper nature of the transaction.
79GY and JY lost their investment in cryptocurrency companies owned by an American named Neil Chandran who had subsequently been criminally charged with a $45 million fraud involving investments in these companies. EM had promoted that investment to GY and JY. While we make no finding as to whether there was anything improper in EM’s settlement with GY and JY, this is a red flag that should have raised a concern for Mr. Fraser as to the nature of the transaction.
80In his initial letter to GY and JY proposing the settlement, Mr. Fraser refers to allegations on social media of EM’s involvement in the Chandran fraud and participating in the “capital” of the investment.
81Mr. Fraser entered into evidence an Etherscan document, dated January 27, 2026, which confirms that JY’s wallet activity was limited to the receipt of the settlement funds. There were no additional deposits or withdrawals. This evidence, Mr. Fraser submits, supports JY’s stated reason for needing Mr. Fraser’s assistance in converting the cryptocurrency to Canadian funds.
82But there is very little evidence of Mr. Fraser satisfying himself as to the source of the funds in EM’s crypto wallet before they were forwarded to JY by Mr. Fraser in 2022. He testified that he made enquiries about the source of EM’s crypto funds and that EM advised him that he earned the funds through investments in Bitcoin and other cryptocurrencies.
83There is no documentary evidence to support EM’s representations about the source of the funds or of Mr. Fraser making any independent enquiries about the funds. He did not mention any attempts to verify EM’s statements about the source of the funds during his interview with the Law Society or in his written representations to the Law Society investigators. His file notes merely state that EM’s funds came from investments in crypto during the Covid-era boom.
84In his testimony before us, Mr. Fraser stated that he looked into at least two of EM’s crypto wallets online, but it is not at all clear how this could have provided any assurance to him as to the legitimacy of the source of the funds. Indeed, in another part of his testimony, Mr. Fraser stated that one of the features of the cryptocurrency system is that the blockchain only identifies transfers between wallets and provides no information whatsoever as to the identity of the owner of any particular wallet.
85The terms of the settlement also required GY and JY to delete online accusations that EM was part of the U.S. fraud and not disclosing information regarding EM’s whereabouts. The terms also required GY and JY to “not intimidate or threaten [EM] to assist with any prosecution procedures nor civil claims.”
86These unusual settlement terms would lead a reasonable person to conclude that there are investors looking for EM, accusing him of participating in and benefiting from the fraud. This constitutes a red flag.
87Finally, the Law Society submits that there was no legitimate reason why the payment of the settlement funds by EM to GY and JY was made in cryptocurrency through Mr. Fraser’s crypto wallet and thus also constitutes a red flag.
88Mr. Fraser’s explanation of the method of the payment of the settlement funds is unsatisfactory. He states that EM did not want GY and JY see his crypto wallet which was the source of the funds. But this contradicts Mr. Fraser’s earlier testimony that the funds transfers between wallets can be traced in the blockchain. More to the point, this objective could have been achieved by EM simply transferring the funds to Mr. Fraser’s trust account. The purpose of using cryptocurrency and Mr. Fraser’s crypto wallet for the payment of the settlement funds is not discernable from the evidence before us; the lack of any apparent legitimate reason for it is another red flag.
89To be clear, we were not asked to, and we do not make, any finding as to the propriety of EM’s interactions with GY and JY. We nevertheless accept the Law Society’s submission that certain characteristics of the interactions as described above constitute red flags which should have alerted Mr. Fraser to the possibility that these transactions had an improper or illegal purpose and they place Mr. Fraser’s misconduct on the third rung of seriousness, same as the misconduct in Albaum.
90However, Mr. Fraser’s misconduct is not as serious as the egregious misconduct found by the panel in Albaum. Mr. Albaum did not know the identity of some of the individuals for whose benefit funds were deposited to his trust account. He disbursed the funds received in his trust account to numerous individuals unknown to him. Mr. Albaum had not recorded in his financial records, and did not know, the purpose of the deposits and disbursements and in one instance, the source of the funds.
91There were more numerous and more serious red flags present in Albaum than in the present case, including the fact that Mr. Albaum’s purported client, AB, had been “demarketed” by a major Canadian bank and made, to the knowledge of Mr. Albaum, numerous false claims, including that he was a member of Parliament.
92Mr. Fraser had previously acted for EM in matters unrelated to crypto or to the alleged investment fraud in the US. The funds originally received from EM remained in JY’s wallet for approximately 18 months, without further deposits or withdrawals. These factors do not excuse Mr. Fraser’s misuse of his trust account, but they make his misconduct less serious than that found in Albaum and inform where the misconduct falls on the spectrum of seriousness.
The extent and duration of the misconduct
93The extent and duration of Mr. Fraser’s misuse of his trust account are aggravating factors. He used his trust account for purposes unrelated to legal services on three different occasions, over a period of five months. The JY transaction involved 15 separate deposits to his trust account. The amounts involved in the JY matter were substantial.
94The cumulative effect of the various red flags identified in the EM transaction and the extent and duration of his misuse of his trust account increase the gravity of Mr. Fraser’s breach of Rule 3.2-7.3. However, while we agree that the misconduct falls within the third rung or category of seriousness, it is less egregious than that found in Albaum and, in our view, falls at the lower end of that category.
95Mr. Fraser submits that the misconduct in Albaum is distinguishable from his case for a number of reasons. He submits that Albaum is a case about knowing and deliberate use of trust as a buffer, not as an accident. Mr. Fraser submits that his misuse of his trust account was “just a technical one”, while Mr. Albaum was found to have known the trust account rules and chose to move money through his trust account regardless.
96Unlike his case, Mr. Fraser submits, Albaum is not a mistake case. It is a choice case. In Mr. Fraser’s case the funds landed in his trust account due to a platform-linked routing error. Albaum involves agency on the part of the lawyer and that is why attracts serious sanction. According to Mr. Fraser, that is the most important distinction.
97We do not accept Mr. Fraser’s submissions that his misuse of his trust account was an accident. Inadvertently depositing funds into your trust account once may be an accident, but doing so 17 times is a different matter. Mr. Fraser was not a passive onlooker, with no agency. He simply chose not to stop using his VirgoCX wallet to convert crypto funds to Canadian currency, even though he knew the money would end up in his trust account.
98There is nothing in the evidence that suggests Mr. Fraser was not aware of the Law Society’s rules regarding the use of trust accounts. On the contrary, his file notes regarding the JY transaction explicitly state that “Funds were handled in compliance with the Law Society's Trust Account Rules”.
99As in Albaum, the potential negative impact of Mr. Fraser’s misuse of his trust account was significant. We do not conclude that EM’s purpose was dishonest, but it easily could have been based on the information known to Mr. Fraser.
Factors relating to the circumstances of Mr. Fraser
The existence or absence of a prior disciplinary record
100Mr. Fraser was called to the bar in 2022 and for 11 years prior to that he provided legal services as a licensed paralegal without a disciplinary record. This is a mitigating factor.
Extenuating circumstances that might explain, in whole or in part, the misconduct
101There is no evidence of extenuating circumstances that might explain the misconduct to ay extent. This is a neutral factor.
Whether the licensee has admitted misconduct, and obviated the necessity of its proof
102Mr. Fraser admitted to the trust account transactions and that they were not related to the provision of legal services. But Mr. Fraser’s admissions did not avoid a hearing or obviate the necessity of proof, as evidence was required at this hearing on the extent of his awareness of the nature of the transactions. There is only a limited mitigation in this factor.
The existence or absence of remorse, acceptance of responsibility or an understanding of the effect of the misconduct on others
103The mitigating effect of Mr. Fraser’s stated acceptance of responsibility for what occurred is substantially diminished by his statements that he lacked agency in these matters and that they were accidents.
104While acknowledging that he committed a “technical error” and errors in judgment, he does not seem to understand that he did anything wrong and shows limited insight into his misconduct. This is a neutral factor.
Evidence as to whether the misconduct is likely to recur
105Mr. Fraser’s misconduct was repeated over a number of months. His limited acceptance of responsibility, as described above, suggests only limited insight into his own misconduct.
106That said, we accept that Mr. Fraser has taken some responsibility for what occurred. He did not deny the transactions, he accepted that the funds were unrelated to legal services, and he submitted that he promptly moved the funds out of trust once they were deposited. He also advised the panel that he has ceased using cryptocurrency in his practice and has changed his practice to prevent similar transactions.
107While we are satisfied that the risk of recurrence is reduced, although not eliminated, by the steps Mr. Fraser says he has taken since these events, there is limited mitigation in this factor.
Comparable cases
108There is a dearth of Tribunal cases where, as in this case, no dishonest purpose was alleged or established and the improper use of a trust account for purposes unrelated to the provision of legal services is the only proven misconduct.
109The Albaum facts are similar to this case, in that the lawyer had received funds in his trust account on four occasions for purposes unrelated to legal services and promptly disbursed them, totalling some $34,185 CAD and $117,685 USD. However, there was additional misconduct found – failure to verify a client’s identity – and the red flags present were more numerous and more significant than in Mr. Fraser’s case. As stated above, that panel suspended Mr. Albaum’s license for nine months.
110In Law Society of Ontario v Patterson, 2025 ONLSTH 15, the lawyer misused his trust account on one occasion by depositing approximately $50,000 unrelated to the provision of legal services. The panel found that the misuse was unintentional and that the misconduct was at the lower end of seriousness. However, the panel also emphasized that misuse of a trust account is significant because of the importance of maintaining public confidence in lawyers’ trust accounts. The panel rejected a reprimand as insufficient, even for an innocent breach, and concluded that a one-month suspension achieved general deterrence and assured the public that trust account rules are taken seriously by the regulator and the professions.
111Mr. Fraser submits that the case of Law Society of Ontario v Wong, 2019 ONLSTH 131, is similar to this case. In Wong, the lawyer was found to have retained some $1.5 million of his fees in his trust account for a period of 5 years. The panel issued a reprimand and extensive auditing requirements for the lawyer’s practice.
112None of the concerns set out in Albaum, cited above, regarding the purposes of Rule 3.2-7.3 are engaged in Wong. While Mr. Wong misused his trust account, all the funds involved were funds that he earned as fees for legal services he provided. The Wong case is of little assistance in determining the proper penalty in this application.
113In Law Society of Ontario v Gordon, 2021 ONLSTH 109, the lawyer was found to have used her trust account twice for purposes unrelated to the practise of law, the funds involved totalling approximately $530,000. While the panel found other misconduct on the part of Ms. Gordon, the panel concluded the improper use of her trust account as the most significant. It found that it was the result of “burnout”.
114On a joint submission, the panel suspended Ms. Gordon’s licence for two months and imposed auditing requirements and mentorship.
115In the case before us, Mr. Fraser deposited funds unrelated to the provision of legal services 17 times. He urges us to view the 15 deposits in the JY transaction as one instance. However, it is clear from his evidence that Mr. Fraser knew after the first conversion of the cryptocurrency in his wallet and the withdrawal of the funds in Canadian dollars that they were deposited to his trust account. He nevertheless proceeded with fourteen further conversions of crypto and withdrawals; all routed to his trust account.
116He did the same in the two subsequent transactions – converted crypto currency to Canadian dollars, resulting in withdrawals being deposited to his trust account. These were not accidents, but rather evidence Mr. Fraser’s cavalier disregard of the rules governing lawyers’ trust accounts.
Analysis and conclusion
117In considering specific deterrence, we find that the misconduct was serious and repeated. However, we also accept that the risk of recurrence is reduced by the fact that Mr. Fraser has ceased using cryptocurrency in his law practice. Specific deterrence remains relevant, but it does not require a lengthy suspension.
118General deterrence and confidence in professional regulation are the primary relevant goals in our consideration of the appropriate penalty in this case. Having considered the important objectives and purposes of Rule 3.2-7.3, we adopt the Chair’s comments in Albaum, that a strong message has to be sent to the professions that a breach of the Rule will result in significant penalty. Similarly, the public and Canadian as well as foreign governments need to be assured that breach of Rule 3.2-7.3 results in serious consequences.
119We conclude that a two-month suspension of Mr. Fraser’s licence is required to achieve the objectives of specific and general deterrence and maintaining confidence in professional regulation.
COSTS
120The parties may provide written costs submissions. The Law Society may file its submissions by June 26, 2026. Mr. Fraser may file his submissions by July 10, 2026.
ORDER
121We order the following:
- The respondent’s licence to practise law shall be suspended for two months effective as of July 3, 2026.
- The respondent shall comply fully with the terms of the Law Society’s Guidelines for Lawyers Who Are Suspended or Who Have Given an Undertaking Not to Practise.
- Within six months of the end of the suspension, the respondent shall complete a trust accounting or practice management program approved by the Law Society.
Footnotes
- Law Society of Upper Canada v. James, 2017 ONLSTA 16 at paras 89, 91-92
- Law Society of Ontario v Kamal, 2019 ONLSTA 20 at para 41.