Court Information

Ontario Court of Justice

Between:

Her Majesty the Queen

— and —

Michael Majeed, Mohammed Raja and Saira Khan

Before: Justice H. P. Brownstone

Heard: June 1, 2, and 4, 2015

Reasons for Judgment Released: June 15, 2015

Counsel

For the Crown: Mr. Hanna

For Michael Majeed: Mr. Bottomley

For Mohammed Raja: Mr. Erickson

For Saira Khan: Ms. Oja

BROWNSTONE J.:

Introduction

[1] Michael Majeed, Mohammed Raja and Saira Khan were charged with obtaining credit by a false pretence (count 1) and knowingly causing a mortgage broker to act upon fraudulent rental agreements (count 2). At the end of final submissions, and for oral reasons given, Mr. Raja was acquitted of both charges. Ms. Khan was acquitted of count 2. Mr. Majeed was also charged with two counts of failing to comply with a recognizance (counts 3 and 4). At the end of the trial the Crown invited an acquittal on count 3. These reasons for judgment deal with:

1. The false pretence charge (count 1) against Mr. Majeed and Ms. Khan;
2. The charge of causing the broker to act upon fraudulent rental agreements (count 2) against Mr. Majeed; and
3. The charge against Mr. Majeed of failing to comply with a recognizance set out in count 4.

BACKGROUND

[2] These charges relate to the obtaining of mortgage funds in the amount of $639,000 to finance the purchase of a new home. The actual purchasers and mortgagors were Mr. Majeed's father, Mohammed Raja, and his sister, Saira Khan. However, the entire transaction was conducted by Mr. Majeed on their behalf. It is clear that, other than attending two meetings at which they were basically silent, and signing some documents, Mr. Raja and Ms. Khan played no active role in this transaction.

[3] All of Mr. Majeed's dealings were with a mortgage broker, Mr. Savio Vaz, of MonsterMortgage.ca. Mr. Vaz obtained all of the necessary documentation from Mr. Majeed and forwarded it to the money lender and ultimate mortgagee, MCAP, in order to satisfy the mortgagee's numerous eligibility requirements. At no time did any of the accused communicate directly with MCAP other than through the broker or their own lawyer. There were many email communications between Mr. Majeed and Mr. Vaz extending over a one-year period, relating to every aspect of the mortgage transaction. The major focus of these communications was to satisfy the mortgagee that the mortgagors would have sufficient income to pay the monthly mortgage payments. Mr. Majeed first contacted Mr. Vaz in June 2012, and the real estate transaction closed and the mortgage funds were provided on August 14, 2013. The mortgage was registered on August 15, 2013 (exhibit 2).

[4] It is alleged that the fraudulent behaviour giving rise to these charges consists of providing to MCAP through the broker, false notices of assessments for Ms. Khan and rental agreements relating to the two properties that she owned, in order to create the impression that Mr. Raja and Ms. Khan had sufficient income to qualify them for a $643,000 mortgage (the amount originally requested).

[5] In June 2012 Mr. Majeed contacted Mr. Vaz to request his assistance in obtaining mortgage financing for his father and sister. On October 10, 2012 Mr. Majeed emailed to Mr. Vaz a completed mortgage application form purporting to be signed by Mr. Raja and Ms. Khan (exhibit 8), as well as fraudulent notices of assessment pertaining to Ms. Khan. On October 22, 2012 MCAP issued a mortgage commitment document (exhibit 1, pages 14-16) stating that the mortgage application was approved, conditional upon Ms. Khan satisfying certain "special conditions": condition #5 required Ms. Khan to provide confirmation of her annual income of $81,000; conditions #12 and #13 required her to provide confirmation of annual rental income totalling $61,200 per year for both properties that she owned. On October 26, 2012, Mr. Majeed, Mr. Raja and Ms. Khan met with Mr. Vaz to review the commitment document. Mr. Vaz testified that Mr. Majeed did most of the talking on behalf of his father and sister. However, Mr. Vaz specifically recalls reviewing the mortgage commitment document with Mr. Raja and Ms. Khan "line by line", especially the "special conditions precedent to advance" (p.15 of exhibit 1), including conditions #5, 12 and 13 referred to above. At no time did Ms. Khan raise any objection or advise Mr. Vaz that her annual income was not $81,000 and/or that she did not have rental income in the amount of $61,200 per year. In fact, she signed the mortgage commitment document in Mr. Vaz's presence.

[6] Mr. Vaz was quite emphatic that the money lender's major concern in every case is the mortgage applicant's credit worthiness, which to a great extent is determined by his or her income. This is true even if a large down payment – in this case 20% of the purchase price – is paid. Accordingly it is clear that any misrepresentations to a prospective money lender by a mortgage applicant regarding income are most definitely material. In this case, given the true incomes of Mr. Raja and Ms. Khan as disclosed in their valid notices of assessment (exhibits 3 and 4), there can be no doubt that the misrepresentations regarding Ms. Khan's income directly induced MCAP to provide the mortgage funding. A significant fraud was perpetrated against MCAP.

[7] Mr. Raja and Ms. Khan resided at 52 Norbury Drive and 76 Brookhaven Crescent respectively. These homes were owned by Ms. Khan. Their plan, which Mr. Vaz was aware of, was to move out of these homes, rent them out, and move in together into the new house at 72 William Bartlett Drive. They would use the rental income from the houses on Norbury Drive and Brookhaven Crescent to help pay the mortgage on the William Bartlett Drive property. Obviously, they would not be able to generate the projected rental income until they moved out of the properties in question and moved into the new house. Only then would they be able to rent out their former residences. Notwithstanding this, Mr. Majeed told Mr. Vaz that the basements of the Norbury Drive and Brookhaven Crescent homes were already being rented out, and on June 6, 2013 he provided Mr. Vaz with copies of rental agreements showing rental income of $2500 per month on the Norbury Drive property and $2600 per month on the Brookhaven Crescent property. It is clear that the rental agreement for the 76 Brookhaven Crescent basement is false, because it covers the period commencing January 1, 2013 and names the tenant as Lindsay Bennett, and it specifies the rental amount as $2600 per month. The court heard testimony from the real tenant who occupied the basement at 76 Brookhaven Crescent. Her name is Lindsay Evans. She lived there from January 29, 2012 to July 2014, and her rent was $785 per month plus a one-quarter share of the utilities. She testified that she never saw another tenant in that house. There is no question that Mr. Majeed provided the mortgage broker with a false rental agreement, knowing that the broker would forward it to MCAP in order to satisfy MCAP's preconditions for lending the money to Mr. Majeed's father and sister. If that were not enough, the Crown provided documentary proof from Service Canada that there are no Social Insurance Numbers for the tenants listed in the rental agreements (Lindsay Bennett and Eric Newman) with the dates of birth stated in the agreements, notwithstanding that these tenants were listed in the agreements as being employees. One cannot be employed in Canada without a Social Insurance Number. It is clear that the "tenants" named in both agreements do not exist. Furthermore, Ms. Khan's authentic notices of assessment (exhibit 4) do not show rental income of $61,200. The evidence leads overwhelmingly to the conclusion that both rental agreements are "false documents" within the meaning of s. 321 of the Criminal Code.

THE EVIDENCE OF MR. VAZ

[8] Mr. Vaz, the mortgage broker, was the Crown's key witness in this case, and his evidence is crucial for a number of reasons. First, all of Mr. Majeed's dealings were with Mr. Vaz. Secondly, it was Mr. Vaz who reviewed the all-important pre-conditions in the mortgage commitment document with Mr. Raja and Ms. Khan at the October 26, 2012 meeting, and therefore the evidence of their knowledge and understanding of these conditions is largely derived from Mr. Vaz's testimony. Thirdly, it was Mr. Vaz who communicated with the money lender and conveyed the fraudulent documents to them. Accordingly, it is important to carefully consider Mr. Vaz's testimony and examine the role that he played in this transaction. Although Mr. Vaz did his best to recollect the details of his interactions with Mr. Majeed, there were some problems with his memory regarding specific details of the transaction. For example, he testified that he did not ask Mr. Majeed why he was not going on title, but he told the police that he did ask Mr. Majeed that question. He testified that Mr. Majeed spoke Hindi to his father, but he told the police that Mr. Majeed spoke English with his father. These are not particularly significant inconsistencies, and are understandable given the length of time that has passed since these interactions occurred.

[9] Mr. Vaz works on a pure commission basis. His revenue depends on brokering successful mortgage transactions, as he is paid a fee by the money lender for each mortgage that he processes. It is therefore only fair to assume that he would do his best in every case to assist his clients to obtain the mortgage funds they are seeking. Although he presented as wanting to be ethical and mindful of his legal obligations, his conduct in the circumstances of this case gives rise to some concern and may suggest otherwise. For one thing, it is clear that Mr. Vaz knew from the beginning that the rental income needed to qualify for the mortgage would not be available until after the closing date, so that Mr. Raja and Ms. Khan could vacate the properties at 76 Brookhaven and 52 Norbury and move into the new home. As far back as October 16, 2012 Mr. Majeed sent an email to Mr. Vaz stating "these properties [referring to the Brookhaven and Norbury homes] will become rental properties". Mr. Vaz could see from the applicant's and co-applicant's addresses on the mortgage application form that Ms. Khan and Mr. Raja were living in the Brookhaven and Norbury homes. Also, it seems clear that Mr. Vaz knew as of March 15, 2013 that the rental agreements did not even exist, for on that date he sent an email to Mr. Majeed asking him to "draw up" the rental agreements. The specific choice of the words "draw up" is very significant and telling.

[10] Secondly, it is surprising that Mr. Vaz did not question the veracity of the rental agreements, given that the rental amounts were so high. It is more than a little unusual that anyone would pay $2500 for a basement apartment.

[11] Thirdly, as I have already stated, Mr. Vaz was aware that the houses could not be fully leased until Mr. Raja and Ms. Khan moved out, so the question of how much rental income could be generated from these 2 properties was very much undetermined at the time that the mortgage application was being processed. This is clear from Mr. Vaz's email dated March 16, 2013 to Mr. Majeed, where he agrees with Mr. Majeed's suggestion to "increase the rental income". This is highly indicative of knowledge on the part of Mr. Vaz that the rental agreements were not yet drafted as of that date, and that the amount of rent to be stated in the agreements was simply a fabrication intended to satisfy MCAP's preconditions for providing the mortgage funds.

[12] Fourthly, and most importantly, on April 5, 2013, Mr. Majeed emailed Mr. Vaz to ask what amount he was required to show on each agreement for each property. It should have been obvious to any reasonable person at that point that no rental agreements were in existence and that Mr. Majeed was looking for guidance as to what amounts he should insert in the agreements he was going to draft, in order to satisfy MCAP. A red flag should most certainly have been raised in Mr. Vaz's mind when he finally got the rental agreements in June 2013, and he saw that they were dated January 1, 2013. If a lease had already been signed on January 1, 2013 why would Mr. Majeed have needed to ask Mr. Vaz on April 5, 2013 what amount he was required to show on the lease? Moreover, it is rather astonishing that Mr. Vaz had no recollection of having responded to Mr. Majeed's April 5 query. Despite what appears to be a complete record of the email correspondence between Mr. Majeed and Mr. Vaz, and very prompt replies by Mr. Vaz to every other email that Mr. Majeed sent, there is no email record of this important question being responded to by Mr. Vaz. For some inexplicable reason, Mr. Vaz chose to give the police only the contents of his email "inbox", not his "sent items" folder, so there is no conclusive proof one way or the other as to whether Mr. Vaz responded to Mr. Majeed's April 5 query.

[13] The above four points raise some suspicion in my mind about the reliability of Mr. Vaz's evidence, and more specifically, the precise role he may or may not have played in the creation of the rental agreements. In any event, it seems clear at the very least that Mr. Vaz ought not to have forwarded the rental agreements to MCAP without first addressing with Mr. Majeed the obvious concerns about the legitimacy of these documents. If he was not an actual party to the defrauding of MCAP, he was at worst, reckless, most definitely negligent, and at best, naive.

[14] In addition, one aspect of Mr. Vaz's testimony is particularly disturbing. He testified that, after the mortgage money was provided, Mr. Majeed called to ask him to delete all of the correspondence between them. He said that he did not ask Mr. Majeed why such an unusual request was being made. That in itself is surprising. But what is nothing short of astounding is that Mr. Vaz did not bother to tell the police about this. The first time he mentioned this conversation was during his examination in chief. He claims that he simply forgot about it until he was in the witness stand. This is so contrary to common sense that I simply cannot believe it. I would have thought that when a person in Mr. Vaz's position receives a request to delete correspondence relating to a transaction, without a reasonable explanation, this is a strong indication that the requester is trying to conceal evidence and cover up some sort of wrongdoing. It is a strong indication of consciousness of guilt. This is not the kind of conversation that would be easily forgotten when one is being interviewed by the police during a fraud investigation. If this conversation actually occurred, I do not believe that Mr. Vaz could have forgotten it, and I am at a loss to understand what his motivation could have been for withholding this disclosure. I am inclined to believe that this conversation did not occur, and that Mr. Vaz, who became increasingly defensive during his cross-examination, felt the sudden need to further incriminate Mr. Majeed by inventing it. This impacts negatively on his credibility.

[15] I have come to the conclusion that Mr. Vaz's testimony raises more questions than it answers.

LIABILITY OF MR. MAJEED UNDER COUNT 1

[16] Mr. Majeed is charged in count 1 with obtaining credit by a false pretence, contrary to s. 362(1)(b) of the Criminal Code. The Crown has proven beyond a reasonable doubt that Mr. Majeed did in fact "obtain credit" in the form of mortgage financing for his father and sister. The law is clear that an offence under this section can be made out whether the accused obtains credit for himself or for another person: R. v. Dvornek, [1962] B.C.J. No. 72 (B.C.C.A.); R. v. Cohen, [1984] Q.J. No. 316 (Que.C.A.).

[17] The definition of "false pretence" is found in s. 361(1) of the Criminal Code. The Crown argues that the "false pretence" occurred when Mr. Majeed provided MCAP (through the broker) with documents that he knew to be false, with the intention that these documents be relied upon in granting credit. The documents in question are the 2010 and 2011 notices of assessment for Ms. Khan, and the rental agreements for the two properties owned by Ms. Khan. (In fact, Mr. Majeed provided the broker with a third document containing false information: the mortgage application. However, this document was never forwarded to MCAP, and the false income information for Mr. Raja and Ms. Khan contained in that document was not given to MCAP, because Mr. Vaz chose to give MCAP the income information from the notices of assessment, not from the mortgage application form. Accordingly, the mortgage application does not constitute part of the "false pretence".)

The Notices of Assessment

[18] There is no question that Mr. Majeed provided the broker with falsified notices of assessments for his sister. The Canada Revenue documents for Ms. Khan filed in exhibit 4 are in the name of NEALUM RAJA and show a total income of $20,969 in 2010 and $17,932 in 2011. Mr. Majeed provided the broker with notices of assessment in the name of SAIRA NEALUM KHAN showing total incomes of $80,239 in 2010 and $81,974 in 2011. These documents are found at pages 30 and 31 of exhibit 1. The Social Insurance Number for NEALUM RAJA and SAIRA NEALUM KHAN is the same number, and I am satisfied beyond a reasonable doubt that NEALUM RAJA and SAIRA NEALUM KHAN are one and the same person, being the accused Saira Khan before the court. Accordingly, it is clear that Mr. Majeed provided the broker with false notices of assessment for Ms. Khan, and he intended that these documents be acted upon by MCAP in its assessment of the mortgage application.

[19] The Crown must prove beyond a reasonable doubt that Mr. Majeed knew that the documents he was giving to the broker were false. Crown counsel argued that the only reasonable inference from the evidence is that Mr. Majeed most likely falsified his sister's notices of assessment and in any event he most definitely knew that these documents were false. He argued that, given the very active role that Mr. Majeed played in engineering this transaction, and the corresponding total passivity and silence of Mr. Raja and Ms. Khan throughout, the evidence overwhelmingly leads to the conclusion that Mr. Majeed knowingly provided falsified notices of assessment to the broker. After all, Ms. Khan is Mr. Majeed's sister and they must have been on good terms if he was assisting her to get mortgage financing. He argued further that, given the probability that Mr. Majeed filled out the mortgage application containing false information about Ms. Khan (this was confirmed by Ms. Osmond, the forensic document examiner), it would be absurd to think that he didn't also play a major role in producing and tendering her false notices of assessment with full knowledge of their falsity.

[20] Counsel for Mr. Majeed argued that no such inference should be drawn because: (1) there is no evidence regarding the extent of Mr. Majeed's knowledge about his sister's income; (2) Mr. Majeed was simply acting as a broker or conduit between the mortgage applicants and Mr. Vaz, but had no way to verify the authenticity or accuracy of any of the documents; and (3) it was Ms. Khan's responsibility to provide her income verification, not Mr. Majeed's. Counsel argued further that Mr. Majeed could not even be found to have been wilfully blind as to the authenticity of the documents, because there is no evidence to suggest that Mr. Majeed's suspicions ought to have been raised without specific evidence that he knew or ought to have known what his sister's true income was. He also submitted that the court should reject Mr. Vaz's testimony that Mr. Majeed did all the talking at the October 26, 2012 meeting and that Mr. Raja and Ms. Khan were essentially silent, because Mr. Vaz was not a credible witness and had a "creative memory". He argued correctly that, while the court may have its suspicions regarding Mr. Majeed's knowledge, this is never enough to constitute proof beyond a reasonable doubt.

[21] I have carefully considered all of the evidence and counsel's very able submissions. The fact is that there is no direct evidence to establish who falsified Ms. Khan's notices of assessment. It is true that it would be reasonable to infer that, if Mr. Majeed was helping his sister obtain mortgage financing, they were on good terms and she would cooperate with his efforts by providing him with her true income information. On the other hand, the mortgage was for her, not for Mr. Majeed. It is equally reasonable to infer that she had an interest in getting the mortgage application approved and could therefore have had a motivation to falsify her notices of assessment, since she must have known that her income could not possibly have qualified her for such a large mortgage. The fact that she failed to speak up at the October 26, 2012 meeting, when condition #5 of the mortgage commitment document was being reviewed with her – by that I mean her failure to disclose her true income - suggests that she may well have had a role in the falsification of her notices of assessment.

[22] Even if I accept Mr. Vaz's testimony that Mr. Majeed did most of the talking on behalf of his sister and father at the October 26, 2015 meeting, and even if I accept that Mr. Majeed filled out the mortgage application, and even taking into account that Mr. Majeed was obviously driving this transaction given the fact that all of the emails to Mr. Vaz came from him, I find myself unable to conclude beyond a reasonable doubt that Mr. Majeed knew that Ms. Khan's notices of assessment were fraudulent.

The Rental Agreements

[23] The evidence clearly establishes that the rental agreements are false, because the tenants named in the agreements do not exist, according to Service Canada records. Mr. Majeed provided the rental agreements to Mr. Vaz knowing that Mr. Vaz would act upon these documents by sending them to MCAP. He did this for the express purpose of meeting MCAP's eligibility requirements so that his father and sister could get the mortgage financing. MCAP relied upon the rental agreements in providing the mortgage funds.

[24] Did Mr. Majeed know that the rental agreements were fraudulent? The answer is yes. The evidence clearly establishes that Mr. Majeed lived at 76 Brookhaven Crescent. The basement tenant, Lindsay Evans, said so and this was unchallenged in cross-examination. Further, the photographs taken during the execution of a search warrant at that address (exhibit 5) provide ample proof that Mr. Majeed lived there. Accordingly he must have known that the tenant in that basement was not a 45 year old (the tenant's date of birth on the fraudulent rental agreement for 76 Brookhaven is February 18, 1967), when it was obvious that the real tenant, Lindsay Evans, was in her 20's. Ms. Evans testified that she had met Mr. Majeed several times, so there can be no doubt that Mr. Majeed knew who the true basement tenant was. It is true that Mr. Majeed did not own the house, was not the landlord and therefore may not have known how much rent Ms. Evans was paying. But he certainly knew that the tenant was not 45 years old.

[25] In addition, the email correspondence dated March 16, 2013 and April 5, 2013 between Mr. Majeed and Mr. Vaz referred to in paragraphs 11 and 12 above, makes it abundantly clear that Mr. Majeed played an active role in the drafting of the rental agreements that were to be submitted to MCAP. It is not necessary for the court to conclude that Mr. Majeed actually drafted the rental agreements, although the evidence strongly suggests that this was the case. It is sufficient that the Crown prove beyond a reasonable doubt that Mr. Majeed knew that he was submitting false documents to MCAP via Mr. Vaz.

[26] Accordingly, the Crown has proven beyond a reasonable doubt that Mr. Majeed, by a false pretence - namely by submitting rental agreements that he knew to be fraudulent—obtained credit for his father and sister from MCAP. A verdict of guilty shall be entered against Mr. Majeed on count #1.

LIABILITY OF MR. MAJEED UNDER COUNT 2

[27] In count 2, Mr. Majeed is charged under s. 368(1)(b) of the Criminal Code with knowingly causing Savio Vaz (the mortgage broker) to act upon forged documents (the fraudulent rental agreements) as if they were genuine. There is no question that the offence of forgery under s.366(1) was committed in the creation of the fraudulent rental agreements, which are "false documents" within the meaning of s. 321 of the Criminal Code: R. v. McMillan, [2003] O.J. No. 3489 (Ont.C.A.).

[28] Mr. Majeed provided the rental agreements to Mr. Vaz in support of a mortgage application for his father and sister. He knew that these documents were required by MCAP pursuant to the mortgage commitment document (conditions #12 and 13). He provided these documents to Mr. Vaz with the sole intention of having Mr. Vaz forward them to MCAP so that the preconditions to receiving mortgage funds would be satisfied.

[29] The Crown must prove that Mr. Majeed knew that the rental agreements were false documents. As stated above, the evidence clearly establishes beyond a reasonable doubt that Mr. Majeed knew this.

[30] Mr. Majeed's counsel argued that Mr. Majeed cannot be found guilty of this offence if Mr. Vaz knew or was wilfully blind to the fact that the rental agreements were false. He argued that Mr. Vaz could not be induced to act as if the documents were genuine if he knew they were false. In other words, if Mr. Vaz was "in on" the fraud, he cannot be a victim of the fraud. I disagree. The victim of the fraud was MCAP, not Mr. Vaz. Without making any finding as to Mr. Vaz's complicity in this fraud upon MCAP, one thing is clear: even if Mr. Vaz was a party to the fraud or wilfully blind as to the authenticity of the documents, this in no way exonerates Mr. Majeed or reduces his culpability. It is Mr. Majeed's actions and intentions which are relevant here. Mr. Majeed did, by giving Mr. Vaz documents that he knew were false, cause Mr. Vaz to act upon them (sending them to MCAP) as if they were genuine. The fact that Mr. Vaz may have known that the documents were false does not change the fact that he sent them to MCAP, presenting them to be genuine, at the instance of Mr. Majeed.

[31] Accordingly, a finding of guilt shall be entered against Mr. Majeed on count #2.

LIABILITY OF MS. KHAN UNDER COUNT 1

[32] Ms. Khan is charged with obtaining credit from MCAP by a false pretence contrary to s. 362(1)(b) of the Criminal Code. The Crown has proven beyond a reasonable doubt that Ms. Khan did "obtain credit" from MCAP in the form of mortgage (see exhibit 2). Whether or not she signed the mortgage application form, she attended a meeting with Mr. Vaz and signed the mortgage commitment document in his presence on October 26, 2012. She also can be presumed to have signed the documents forwarded to MCAP by her lawyer in order to finalize the transaction (exhibit 1, pages 158 – 175). Despite Mr. Majeed's primary role in this transaction, there can be no doubt that Ms. Khan intentionally applied for and obtained a mortgage.

[33] The term "false pretence" is defined in s. 361(1) of the Criminal Code as follows:

A false pretence is a representation of a matter of fact either present or past, made by words or otherwise, that is known by the person who makes it to be false and that is made with a fraudulent intent to induce the person to whom it is made to act on it.

[34] The Crown submits that the "false pretence" takes the form of false information provided to MCAP (via the broker) regarding Ms. Khan's annual income including rental income. MCAP received false notices of assessment for Ms. Khan for 2010 and 2011, and false rental agreements naming her as landlord, for the two properties she owned.

The Notices of Assessment

[35] There is no question that false notices of assessment were submitted for Ms. Khan. These documents were provided to Mr. Vaz by Mr. Majeed, not Ms. Khan. They were provided by email on October 10, 2012, two weeks before the October 26, 2012 meeting with Mr. Vaz which Mr. Majeed, Mr. Raja and Ms. Khan attended.

[36] Mr. Vaz testified that at the October 26, 2012 meeting, he reviewed "every line" of the documentation with Ms. Khan and Mr. Raja, including the conditions on the mortgage commitment document located at p.15 of exhibit 1. Despite the problems with his testimony referred to above, I accept his evidence that he carefully reviewed each condition with Mr. Raja and Ms. Khan, and that she was fully aware that her income was being represented to be $81,000. His assertion that he reviewed the conditions on the document with Mr. Raja and Ms. Khan was not challenged in cross-examination.

[37] Accordingly, I find that at the meeting, Ms. Khan was made aware that as a mortgage applicant, she had the obligation to provide confirmation of her $81,000 income. It is reasonable to assume that it was mentioned at the meeting that Mr. Vaz was already in possession of Ms. Khan's notices of assessment (he had received them on October 10, 2012). In any event, whether or not she knew that Mr. Vaz already had the notices of assessment, she saw that her income was being falsely represented, and she had every opportunity at that meeting to object to this figure and clarify what her true income was. In fact she had an obligation to do so. She signed the mortgage commitment document, which signified that she understood the document, acquiesced to the correctness of its contents (as they related to her) and undertook to comply with it. It was her responsibility to ensure that Mr. Vaz was provided with accurate notices of assessment. She could not, by delegating responsibility for conveying documentation to her brother, absolve herself of this responsibility. In my view, her very telling silence at the October 26, 2012 meeting, combined with her signing the mortgage commitment document, constituted a "false pretence" within the meaning of s. 361 of the Criminal Code. I am satisfied beyond a reasonable doubt that Ms. Khan represented to MCAP (through Mr. Vaz), "by words or otherwise", that her income was as stated in the mortgage commitment document.

[38] In coming to this conclusion it was not necessary to determine who created the fraudulent notices of assessment. The basis of Ms. Khan's culpability on this charge is that, in order to obtain credit, she fully intended to and did convey to MCAP (through the broker) that her annual income was $81,000, knowing that this was false. She knew that this income figure had to be substantiated by notices of assessment, and she knew that her brother was submitting all documents on her behalf. The only reasonable inference to be drawn from that knowledge, together with her conduct at the October 26, 2012 meeting, is that she authorized the provision to MCAP of fraudulent notices of assessment. I am satisfied of this beyond a reasonable doubt. On this basis I find Ms. Khan guilty of count 1.

The Rental Agreements

[39] With respect to the rental agreements, the situation is different for several reasons. First, the email correspondence in March and April of 2013 between Mr. Majeed and Mr. Vaz discussed above strongly suggests that Mr. Majeed and not Ms. Khan produced the rental agreements. Secondly, there is no evidence that Ms. Khan signed the rental agreements or was even aware of them. It is true that, at the October 26, 2012 meeting she was made aware of conditions #12 and 13 which specified her obligation to provide confirmation of $61,200 of rental income. However, given the clearly articulated plan that this rental income would only be generated after the closing date, it was reasonable for Ms. Khan to assume that she would not be in a position to provide confirmation of the rental income until after the closing date. She may well have thought that the $61,200 rental income mentioned in conditions 12 and 13 were projected income to be earned once the Brookhaven and Norbury houses were rented out after the closing date. The evidence falls far short of establishing beyond a reasonable doubt that Ms. Khan participated in the creation of the false rental agreements or authorized her brother to send them to Mr. Vaz.

FAIL TO COMPLY WITH RECOGNIZANCE CHARGE AGAINST MR. MAJEED

[40] Mr. Majeed is charged in count 4 with failing to comply with a recognizance entered into on December 7, 2012 (exhibit 20). Although there is some discrepancy between the case/file number located in the top right corner of the recognizance and the numbering on the informations filed as exhibits 21 and 22, I am satisfied that the recognizance relates to those informations, because: (1) some of the numbering is the same; and (2) all of material particulars of both documents correspond to each other (offence date, list of offences, and the December 6, 2012 endorsement). I am also satisfied that the recognizance was in effect at the material time.

[41] The recognizance contains a condition prohibiting Mr. Majeed from opening any new bank accounts or credit accounts except for a BMW lease agreement. Mr. Majeed is charged with having breached this condition by opening a credit account for his sister and father. Mr. Majeed did not technically open any new bank account or credit account in his own name. The credit account with MPAC was in the names of Mr. Raja and Ms. Khan. However, if Mr. Majeed forged their signatures on the mortgage application, then he would be guilty of violating this condition of his recognizance. The expert opinion evidence of Ms. Osmond, forensic document examiner, in this regard is that Mr. Majeed "probably" filled out the mortgage application, but there is no reliable evidence that he forged either or both of his father's and sister's signatures on the application form. In fact, Ms. Osmond's opinion was that Mr. Raja "probably" signed the mortgage application himself.

[42] The Crown urges the court to adopt a broad interpretation to the term "open an account", and to find Mr. Majeed guilty because he was the person who engaged the broker, provided all documents, and communicated with the broker on behalf of his father and sister. In effect, Mr. Majeed "opened an account for his father and sister". Crown counsel pointed out that the condition in the recognizance does not simply prohibit Mr. Majeed from opening accounts in his own name; rather, it prohibits him from opening "any" new accounts, no matter whose names they are in. While there is some appeal to this argument, the fact remains that none of Mr. Majeed's efforts would have had the effect of opening an account if his father and sister had not signed the necessary documents, which they did. Mr. Majeed did not have a power of attorney for his father and sister. They had to attend the meeting with the broker and with their lawyer and sign the crucial documentation that created the credit account. There is no evidence that Mr. Raja and Ms. Khan were acting as trustees for Mr. Majeed, or that he held any beneficial interest in the property being mortgaged or the mortgage funds.

[43] Accordingly, the Crown has not proven beyond a reasonable doubt that Mr. Majeed opened a new credit account, and a verdict of not guilty shall be entered on count 4.

Released: June 15, 2015

Signed: Justice Brownstone