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Ontario Home Developer Accused of $37M Fraud Scheme

Ontario Home Developer Accused of $37M Cheque-Kiting Fraud Scheme

CBC News 28 APR 2023

https://ci4.googleusercontent.com/pr...MfIKNnUDBtOrZs

StateView Homes's head office is located in Woodbridge, Ont. TD Bank alleges the company carried out a cheque-kiting scheme to the tune of more than $37 million between April 2022 and last month. (Paul Smith/CBC)

A major Ontario home developer is facing startling allegations from one of the big five banks that it orchestrated a "highly sophisticated," year-long fraud totalling over $37 million.

TD Bank has filed a lawsuit against StateView Homes, based in Woodbridge, Ont., north of Toronto, and headed by brothers Carlo and Dino Taurasi, alleging the company carried out a "cheque-kiting" scheme from April 2022 to last month.

The lawsuit also names as defendants 25 associated corporations, five directors of those companies and StateView's former chief financial officer Daniel Ciccone.

TD alleges the defendants wrote thousands of bad cheques for large sums of money from both corporate and personal accounts at other banks, according to its statement of claim, filed in the Ontario Superior Court of Justice in Toronto.

TD alleges the defendants would cash the cheques into TD accounts and TD would conditionally release the money before the cheque cleared. The bank says the defendants would quickly withdraw the funds and then cancel the cheque to prevent the money from actually being transferred to the TD account.

Over the course of the year, that left TD being owed $37,028,055,73 plus interest, the bank claims.

"Review of the account histories revealed what appears to be a highly sophisticated cheque-kiting fraud spanning about 12 months and dozens of accounts, implicating multiple financial institutions," the bank says in its claim.

To avoid detection, the defendants were routinely doing these "sham transactions" across 22 accounts to create the illusion of fresh funds coming in, TD alleges.

While StateView did not file a statement of defence, it appears to have a proposed settlement agreement with TD to pay back all the money by July, according to a signed copy of the agreement viewed by CBC Toronto but not contained in publicly available court documents.

Another court document seen by CBC Toronto indicates the lawsuit was filed in order to cement the settlement.

Neither TD nor StateView would comment on the settlement.