Royal Bank of Canada Inc. (TSX:RY) has won a $6.4 million judgment from a business customer over an alleged cheque kiting scheme.

Ontario’s Superior Court of Justice ruled in favour of the bank and against Roland Hejna, a Muskoka, Ont.-area marina developer, granting RBC an order for summary judgment for $6.37 million, and declared it to be a judgment in fraud under bankruptcy legislation, meaning that the amount owing survives bankruptcy proceedings.

According to the decision released last week, the court found that the bank “met the onus of showing that there is no genuine issue requiring a trial in order for this court to reach the determination that the defendant knowingly undertook conduct referred to as cheque kiting. The evidence supports the conclusion that the defendant knowingly engaged in cheque kiting by inter-account deposits and withdrawals through a daily series of cheques.”

It notes that the defendant in the case did not deny the amounts owing to RBC, but did deny that there was any fraud or wrongdoing. He maintained that there was a genuine issue for trial to consider whether RBC authorized the transactions involved, or at least was aware of them, among other defences.

However, the court found in favour of the bank, ordering the $6.37 million judgment, plus almost $30,000 in costs.