6 plaintiffs from Toronto's Chinese community accuse broker of mortgage fraud

It's been more than three years, but Yan Ting "Tina" Li says she still remembers meeting Po Yuk "Peggy" Chan at a Thanksgiving party.

The 45-year-old mother of four says Chan struck her as compassionate and pious, and took an instant liking to her.

"I thought she was a very helpful and honest person," Li said, in an interview translated by her eldest daughter.

The two, she claims, exchanged phone numbers and cultivated a friendship over two years.

"I treated Peggy as family," said Li.

That relationship has since dissolved. Li is accusing Chan of defrauding her out of hundreds of thousands of dollars, by forging or arranging for the forging of documents to put a second, and later, a third mortgage on Li's property. Li claims the mortgages were registered without her knowledge.

Civil court documents filed in Ontario Superior Court show Chan is named in five other civil suits — all by members of the Chinese community, all alleging mortgage fraud. Through her lawyer, Chan denies the allegations and says the alleged victims were willing participants in a plan to collectively invest in real estate by obtaining high-interest loans through private lenders.

As previously reported by CBC News, the allegations come as title insurance companies say they're seeing a rise in mortgage fraud cases, and lawyers are cautioning homeowners to protect themselves.

The alleged scam

In an affidavit, Li alleges Chan invited her for tea or coffee and asked about her family. Li says Chan learned that she has four kids and has been working to save for her children's university.

She claims Chan told her she owned a brokerage company and could help her obtain a $400,000 loan to buy a property near the University of Waterloo, where they expected to study.

Li says Chan explained that her company could lend her $400,000, interest free, which Li could offer to a bank as collateral security for a loan. Chan could obtain that loan without further mortgaging her home.

"My first reaction was that it sounds too good to be true," said Li.

"She explained to me if that if the loan proceeded and followed through she would get a commission from the bank."

In her affidavit, Li alleges Chan came over in late 2019 to collect documents that she said were needed — including Li's drivers license, which she alleges was not returned for days. 

Li claims Chan drove her to various offices to sign documents and told her they needed to open a joint bank account. At the bank, Li says the documents were all in English — which she says she does not understand — but maintains she trusted Chan.

"I 100 per cent trusted her at the time because she was always over at my house, eating dinner with my family — we considered each other family," said Li.

Li says Chan told her the loan from her brokerage was approved, and a cheque for the collateral — $330,151.73 — was deposited in the joint account. But within a month, Li claims the balance, except for a few hundred dollars, was withdrawn by Chan.

Li says when the pandemic hit a few months later, Chan told her the bank loan was on hold "indefinitely." Li says it wasn't until spring 2021 that Chan told her the loan was moving ahead again, and Li says Chan asked to sign more documents.

The loan, Li alleges, never materialized.

Then, in September 2021, when Li went to renew the mortgage of her Markham, Ont., home, she says she was shocked to learn there were two additional mortgages on it. She says she immediately contacted Chan, and says Chan told her it was a "mistake" by her company and that she'd have a lawyer discharge the mortgages.

In June 2022, Li says a title search confirmed both mortgages were still in place — one was registered in November 2019 for $400,000, and the other in May 2021 for $392,000. 

"When I found out there were actually two mortgages on my title search, I immediately wanted to cry and break down. I was really scared," said Li.

In the civil court documents, Li alleges her signature on the mortgage documents was forged and that she may have been impersonated.

She's filed a police report and is now dealing with the aftermath of these events — including the potential of losing her home. 

Li's also received a notice of power of sale on her home because those two additional mortgages were in default.

Her legal team is working on taking steps to have those mortgages deleted.

Other alleged victims

CBC News has reviewed the court documents. In two cases, the plaintiffs claim they first contacted Chan after seeing an advertisement in a Chinese-language newspaper. In three of them, the plaintiffs say  they do not read or speak English, and allege that Chan misrepresented documents.

None of the allegations has been proven in court.

One of them — a retiree and two-time cancer survivor — claims, like Li, she developed a friendship with Chan before the alleged fraud. 

Lawyers Richard An with Evremonde Law and Ellad Gersh at Robins Appleby LLP represent Li and other alleged victims of Chan. 

Lawyer Ken MacDonald represents two other clients: one who claims they had around $900,000 in mortgages registered, another around $1.15 million — all without their knowledge.

"The common thread seems to be to exploit trust and go after a person who's got a house and with equity in it, mislead the client about what papers the client is signing, and rush the client. Then the proceeds of the mortgages go into accounts held jointly by Peggy [Chan] and the homeowner." said MacDonald.

"Without the homeowner's knowledge, then Peggy takes the money."

 Chan's assets have been frozen since last summer following an application by MacDonald. 

 Chan denies allegations

Through her lawyer, Chan denies the allegations. David Myers claims the alleged victims agreed to purchase investment properties with Chan then sell them for a profit. 

"The only sort of fraud that exists here is the accusation that these investors did not know or did not understand what they were investing in," Myers said. 

Myers claims his client connected the homeowners with private lenders who facilitated mortgages on their homes. He alleges the funds would go toward purchasing investment properties, but after the market took a turn, profits declined and they couldn't make the payments on their high-interest loans.

CBC News has not seen any evidence to corroborate those specific claims. In one of the civil cases filed, the plaintiff acknowledges she did co-purchase two properties with Chan, but she also alleges Chan took out money from her mortgage without her knowledge.

Myers says early stage motions are still being dealt with — including the freezing of Chan's assets —  so they have yet to file a defence. He maintains Chan did not "target" members of her own community.

"This entire group of investors, plus my client — they were all together in there," said Myers.

That's a claim Li's lawyers maintains is "totally false."

Chan "has not presented any evidence in support of that allegation in any of those cases," An and Gersh said in a statement.

Chan is currently listed as "not authorized to sell" under her mortgage broker license because, as of Dec. 9, 2022, she does not have a sponsoring brokerage.

The Financial Services Regulatory Authority of Ontario, which handles licensing for brokers, says it's "reviewing concerns about Chan's conduct" but couldn't reveal more details. 

 As for Li, she says she's telling her story so that others don't end up in her position.

"I really want the people of the Chinese community to know because there's a vulnerable group of people being targeted."