Former notary public committed $83M fraud, BCSC alleges

The BCSC says that Samji told investors that:

> their money would be safely held in her notary trust account, and would not be paid out to any party;

> her trust account was monitored and audited by the Society of Notaries Public of British Columbia;

> she would provide a B.C. winery, the Mark Anthony Group Inc, and other wineries with a comfort letter, which would allow the wineries to use the funds as collateral for loans in foreign countries; and,

> investors would receive a fee of between 12% and 30% annually in return for putting their money “in trust” with Samji.

The BCSC alleges that all of these claims were false. In reality, it says, Samji had no notary trust account. She deposited investors’ money into two personal bank accounts in the name of her two companies, Rashida Samji Notary Corporation and Samji & Assoc. Holdings Inc. She did not provide letters of comfort to any wineries, and she paid existing investors with money from new investors under the guise of investment fees.

The regulator is also alleging that Samji falsified documents and created a false land title search as part of a fraudulent mortgage.

Samji became a notary public in 1988. In 1995, she began running her notary practice through her Notary Corporation. In 2006, she became a “roving notary” whose practice was limited to covering the practices of other notaries due to illness or vacation.

The Society of Notaries Public of B.C. suspended Samji on Feb. 7, and obtained a court order appointing a custodian over her practice on Feb. 8. She subsequently submitted her resignation on March 6, 2012.

The allegations in the notice of hearing have not been proven. Counsel for the executive director of the BCSC will apply to set dates for a hearing into the allegations.

Financial planner banned

The BCSC also issued a settlement agreement on Wednesday banning a financial planner for his role in the fraud. Arvindbhai Bakorbhai Patel (aka Arvin Patel), a Vancouver resident and former mutual fund salesperson with Coast Capital Savings, has been permanently banned from trading securities or exchange contracts, acting as a registrant, promoter, director, officer, or in a management or consultative capacity in connection with the securities industry.

The BCSC found that Patel engaged in multiple illegal distributions, conducted trades outside of his registration, and made numerous statements to investors that he ought to have known were false between at least 2006 and January 2012.

Patel admitted that during this period, he introduced approximately 90 investors to an investment opportunity through Samji.

Many of the investors were Patel’s family, co-workers, and Coast Capital clients. Collectively, they invested approximately $28.9 million, of which a substantial portion is now lost.

In addition to the ban, the BCSC said it considered levying a multi-million dollar fine against Patel for his misconduct. However, given that Patel is 58, unemployed, has substantial liabilities, and is a defendant in multiple civil actions by investors, the regulator determined that he would have no reasonable prospect of being able to pay such a fine.