BMO

BMO DEFRAUDS INVESTOR CLIENT’S ESTATE

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BMO Nesbitt Burns  conspired with one sibling to defraud a client’s estate and another sibling out of their inheritance. Their efforts included fabricating and concealing  alleged evidence. It culminated in providing false testimony under oath, in my view, and caused extensive damage.

The case of Laski v. Laski revolved around allegations that Wendi Laski, the deceased’s daughter had used fraud and undue influence to change all his accounts from Harold alone, into joint accounts with survivorship to her, thereby defrauding the estate and leaving nothing for her brother Wayne. This was all done while Harold Laski was under palliative care in the last three months of his life. There was no credible evidence that he knew of the changes. The evidence was quite the opposite.

Harold Laski, at 88, was proud of the fact that he was completely self-sufficient. In mid-December 2011 he fell to his knees and could not get up. From that moment until he passed away on March 13, 2012 he was under 24-hour palliative care. That day he fell to his knees, his life as he knew it was over. He would live the next three months under 24-hour palliative care at the hospital and then later sent home to die. That day he fell to his knees, the bulk of his estate was in his name alone. Over those next three months, his daughter Wendi Laski  arranged to have all of those accounts made joint with right of survivorship to her. This was done under suspicious and unusual circumstances outside of the normal course of business.

Harold Laski left a will dividing the bulk of his estate 60% to his daughter Wendi, and 40% to his son Wayne. Another sibling had received his share by getting his parents house 20 years earlier. Harold had advised  both Wayne and Wendi of his wishes and shown them a copy of the will.

At the time of his death, Harold had his investment accounts with BM0 Nesbitt Burns (also referred to as BMO which includes the employees and management of BMO Nesbitt Burns). The account representative was a man named Norman Yu. The week following Harold’s passing, Wayne phoned Norman Yu to discuss the accounts. Contrary to what he’d been expecting, he was advised by Norman that “all of the accounts were in Wendi’s name alone”.

Wayne was totally shocked. He advised Norman that he was an executor of the estate as well as a beneficiary. He asked Norman directly whether he had any information relating to how this happened. Did Harold say anything to him about this? Norman refused to answer. This was the beginning of an almost four-year fight with BMO Nesbitt Burns to get that information. They refused and stonewalled.  They made it clear they would not provide any information and would vigourously oppose any attempt to get  information from them or Norman Yu.

Wayne realized that something was clearly wrong and he could get no explanation, cooperation or information from his sister and BMO. He had no choice but to turn to the courts. Anyone who has ever been in fight over an estate can tell you what a nightmare the entire experience becomes. That is another story for another day.  The focus here, is the  shocking and illegal conduct of BMO Nesbitt Burns in helping one sibling steal from another.

Norman Yu is a central character. He committed most of the fraudulent acts in dealing with Harold Laski’s estate. I want to make it clear that I place most of the blame on BMO Nesbitt Burns. That includes any of the employees and management who were involved . They were clearly were, or should have been, aware of it. BMO immediately hired some very expensive lawyers to deal with the matter. The fact is that they circled the wagons and didn’t appear to ask the obvious questions about the suspicious circumstances outside of the normal course of business. They did that knowing that they were causing damage, but did not care.  Ultimately it seems clear to me that they allowed Norman Yu to lie under oath and allow that evidence to go before a court.

The evidence of the involvement and conduct of BMO Nesbitt Burns, will in my view,  show improper conduct by an employee which was arrogantly and aggressively backed up by management with more impropriety. All this time they were aware, or should have been aware, of what was being done in their name and the harm and damage it was causing.

The nightmare began, March 19, 2012, when Norman Yu told Wayne Laski that the accounts were all in the name of Wendi alone. That would prove to be not true at the time. They were still in the process of being stolen and were still in a joint account with Wendi and Harold Laski. The transfer from Harold Laski alone to Wendi and Harold was according to the evidence, not done before Harold had died but after. When Harold died, the money was in his name alone and should have been divided in accordance with his will.

There followed, an expensive legal battle to get any kind of record of disclosure and financial information from BMO and Wendi. All of this time, Wayne was asking BMO, their lawyers and Wendi’s lawyers for any information or evidence they had with respect to Harold’s intentions or any explanation as to how the money ended up in Wendi’s name alone.

Despite constant efforts, both verbally and in writing, to find out what Norman or BMO had to say, they aggressively continued to stonewall  for almost 4 years.

A mediation,  required by the Court,  had been scheduled for May 2014. In  January 2014, Wayne’s lawyer at the time, made an arrangement with counsel for BMO, to have a without prejudice meeting with Norman Yu. This over the objections of Wayne, who wanted this evidence under oath. BMO insisted that this was the only way they would produce Norman Yu without a vigourous fight. The stated purpose of this meeting was for the lawyers for Wendy and Wayne to hear from Norman Yu, for the first time. This turned out to be a false premise. At the end of the meeting,  Mr. Donald Baker, Wendi’s lawyer,  announced to Wayne and his lawyer, to their shock and surprise, that he had heard all this before. This had occurred at a secret meeting with BMO and Norman Yu in July 2012 where they made him “promise not to tell”.

In the January 2014, without prejudice, meeting,  Norman Yu stated the following:

Up until the time  Harold Laski went into the hospital,  he had nothing but nice things to say about his son Wayne and was very proud of him. When he went to see Harold at the hospital he said he did not want Wayne to have any of his assets and wanted to leave everything to Wendi. As the litigation proceeded Wayne discovered other evidence about their dealings that had been obstructed or concealed by Wendi and BMO.

Given that the meeting was without prejudice, nothing said in the meeting could be used. Throughout the rest of the course of the litigation BMO and Wendi refused to even acknowledge the meeting, confirm or provide any information, or answer any questions about BMO’s dealings with Harold or Wendi. BMO refused to explain the significant delay in bringing this information forward. They continued to conceal this evidence for almost three more years until December 2015 when they arranged with Wendi’s lawyers to produce Norman Yu to be examined under oath. This was a little more than a month before the case went to court in January 2016.

In his December 2015 examination, Norman gave evidence that he had not said in the without prejudice meeting three years before.

Wendi had contacted Norman Yu while Harold was in the hospital following which Norman came to see Harold in the hospital. Harold had not called Norman Yu. On January 10, 2012, immediately after  Harold was released from the hospital and sent home under 24-hour palliative care to die, Norman came to visit Harold. Again Harold had not called Norman. It was Wendi who continued to call Norman. He brought with him the papers he had prepared to direct the transfer of Harold’s investment account from his name alone into an account joint with Wendi with right of survivorship.

The  dealings with those documents by BMO were suspicious and outside of the normal course of business. To begin with, it would be normal and prudent to affect the transfer right away. This was even more urgent, because Harold was clearly dying.

The trail of this paper and the transaction it represented is very unusual and troubling in the circumstances. Despite Harold’s quickly failing health, and the apparent urgency, as evidenced by Norman’s visit January 10, as soon as Harold got home from the hospital, the transfer did not take place for over two months. The transfer papers remained in Norman Yu’s briefcase until late February. It was at that time on February 29, that the transfer direction document was supposedly acknowledged and accepted by BMO.  Not only was the handling of this document, to this point, outside of the ordinary course of business, it was a tremendous risk for Norman and BMO.  If Harold died before the transfer was actually done then the account would be in his name alone at the time.

This is not the end of the curious and unusual path of this document and the transfer. After being approved the document would be sent immediately to the department where the transfer would actually be done. The actual transfer, I believe the evidence clearly shows, was not done until after Harold Laski had died. This is supported  by a sworn statement by Wendi Laski:

48   The Direction was accepted by BMO Nesbitt Burns Inc. on February 29, 2012. Although the securities were not deposited into BIM Joint Account # 4551381314 in advance of March 13, 2012. the Direction was irrevocable and therefore the instruction could not be changed once BMO Nesbitt Burns accepted the Direction.

 According to BMO records, the transfer was dated March 12, 2012. This was conveniently the day before Harold died. This was in direct contradiction to Wendi’s clear and detailed statement on the issue. Wendi’s statement is consistent with the evidence that Wendi would know knew this because immediately after she was informed of her father’s passing, one of her first calls, if not the first, was to her father’s financial advisor Norman Yu. Wouldn’t that be the first person any of us would call after hearing their father died? Wendi says this was to tell him Harold had died. Why would he have to know so quickly? Why was he the first person she called. It is consistent with the evidence that the call was to let Norman know that he should make the transfer happen. They didn’t know how long Harold would live. If they had affected the transfer before Harold died, he might have received a statement showing a joint account. They did not want and could not let that to happen. They had to wait until Harold died and backdated the transfer to the day before. That would explain the odd course of this document very much outside of the normal course of business. In the normal course of business any similar type of transaction at most financial institutions would be done right away, or if the circumstances required, within a few days. It an would also explain and is consistent with Wendi Laski’s sworn statement on the timing of the transfer.

In little over a week, the account had been transferred into Wendi’s name alone. The evidence on how this was done is contradictory and suspicious.

I am trying to limit myself to BMO’s  involvement in the case. To put BMO’s involvement  in context, it is helpful to provide a brief overview of the rest of the case. A review of Wendi’s conduct combined and interwoven with the BMO’s shows how frighteningly easy it was for a criminal like Wendi Laski to take advantage of BMO’s corporate culture to aid and abet her in committing the fraud.

There is a lot of evidence to show Wendi’s conversion of the entire estate.  The case is filled with evidence of Wendi’s fraudulent conduct.  She lies in her examinations under oath, she lies in a conversation, recorded with her knowledge and consent, to her brother Wayne about the estate.

Her actions also speak volumes. Wendi lived in Los Angeles. On the advice of the medical staff, she came to Toronto when Harold went into the hospital.

Most of her involvement in the transfer of Harold’s BMO investment account was detailed above. She did the same thing with the Toronto Dominion Bank where Harold kept his accounts. She contacted them. Harold did not. She had them prepare documents for the transfer of the accounts jointly with Harold with right of survivorship to her. An employee of the TD Bank came, at Wendi’s request, to the hospital where Harold signed the documents.

The circumstances surrounding the signing of all of these financial transfers documents are filled with confusing and contradictory evidence from Wendi and the financial people in attendance. There is no evidence that the documents were properly explained to Harold, or that he even knew what he was signing.

There was other evidence which demonstrates the kind of person BMO was conspiring with, assisting  and enabling to commit fraud. One further example was that at her first opportunity, which was the morning of her father’s funeral, Wendi attended at the TD Bank and transferred all of the accounts into her name alone at Bank of Montréal.

This is where the case takes its strangest twist. This is where BMO’s fraudulent and abusive conduct  is seriously egregious. At Yu’s examination, Mr. Parley, tried to argue that Yu no longer works for BMO and therefore his evidence would not bind them. Norman Yu has always and continues to be represented by BMO’s lawyers. At all material times, he was employed by and acted on behalf of BMO who gave their stamp of approval to and vigourously defended his actions.

In his December 2015 examination, Norman Yu provided details he had not mentioned in the without prejudice meeting.  This was under oath. He gave the only direct evidence, that was relied upon, by a Judge, who was misled, of Harold Laski’s intentions. His evidence was that Harold was upset because Wayne was bullying him. He wanted to leave everything to Wendi.

The other new and significant disclosure was that Wendi was in the room with Norman when Harold gave reasons to disinherit Wayne and give everything to Wendi.

Forgetting for a moment that Wayne had no opportunity to examine Wendy about this, it is very problematic on its face.

If Norman Yu was telling the truth, Wendi would’ve heard the same evidence he heard from Harold directly in regard to his intentions. Wendi never raised  this evidence on her own. Not once, did Wendy or her lawyers corroborate or provide any evidence of her meeting with Harold and Norman. Not once, did she mention that she had heard her father express his intentions.

One would have to ask why this is so. If Wendi had this evidence, is it believable within the balance of probabilities, that Wendi and her lawyers would not have provided this evidence at the beginning of the litigation

The answer is that Norman Yu was not telling the truth. This evidence when combined with his actions and his dealing with the January 10 transfer direction lead to the conclusion that Wendi and BMO conspired to transfer Harold Laski’s account into Wendi’s name alone thereby defeating Harold’s will. Why he did it one may never know. It is certainly consistent with his evidence that he wanted to keep the account. There are many other reasons one can think of that would motivate Norman Norman to commit fraud with Wendi.  Whether Norman  received money or some other consideration will most probably stay between them.  The fact remains that the evidence  shows what they did which was clearly a fraud on the estate and on Wayne.

One thing is clear. Norman Yu’s conduct in conjunction with Wendi’s was suspicious and outside the normal course of business.  The evidence as it stands leads to the conclusion that Norman Yu lied under oath. This, combined with BMO, adopting the actions of, and, protecting Norman Yu knowingly caused serious damage to Wayne Laski

BMO may try to argue that these were mostly the acts of Norman Yu, a rogue employee. The problem is BMO  knew or should have known what was going on.  Wayne Laski made it clear to be BMO  that there was a problem and he was concerned about their conduct. Through their lawyer’s, they stonewalled and allowed the expensive litigation to continue involving the estate of one of their clients and a current client against an executor and beneficiary to the estate. Knowing this, forgetting for a moment its obligations to the estate of its deceased client, they withheld evidence, which would have, and ultimately did end the litigation.  This while all of the parties, including their current client were expending large sums of money engaged in an estate battle.

Even if you assume (contrary to his own evidence) for a moment that Norman Yu was alone with Harold when he expressed the intentions, that Norman Yu claims.. Is it believable that Norman Yu would have this information and not tell his client,Wendi Laski, about his conversation with Harold at the first opportunity he spoke with her after Harold’s death? Why would he not tell her that she didn’t have to fight with Wayne? He had evidence that Harold wanted to disinherit Wayne and for her to have all the money.

BMO has even argued that they would not provide the information to Wayne,  because he was questioning their conduct. Given their attitude, he had indicated that he might have to bring an action against them if they continued their conduct. They had an obligation to share the information regarding the estate of their client with his executors. If, as it turned out, their conduct was improper and damaging, it was no excuse not to provide the information to Wayne as an executor of the estate.

Wayne eventually had to sue BMO in order to try and get the concealed information. BMO changed their lawyers, retaining the high powered elite boutique litigation firm of Lenczner Slatt.  Wayne also sued the directors of BMO Nesbitt Burns.  This was done,  first and foremost because Wayne felt that the management was responsible for the frauds of BMO and its employees, particularly when the details are available to them. I believe that the people who run these companies are responsible and should do all they can to ensure that this kind of conduct is not done in their name.  The second reason to sue the directors personally was so that they would be able to read what had happened and was happening and be given the opportunity to look into it and do something. They could no longer deny knowledge of the facts. The third reason that the directors were included, was to get BMO’s attention. That it did. Their lawyers wanted the directors to be released and were nice to Wayne until he let the directors. He did so as not to complicate and slow the progress of the lawsuit. I believe that directors of companies should be held responsible for frauds committed by employees. They should have responsibility for the corporate culture that allows this kind of thing, to occur, without proper oversight. They should be held accountable for  the failure to punish offenders and take remedial action to ensure that it does not happen.

They continued the position taken by their client’s previous lawyers that they would not discuss the evidence of Norman Yu nor provide any information. It was this firm, most particularly Andrew Parley, who represented Norman Yu and the BMO  in the examinations.

Mr. Parley refused to let Norman Yu answer questions explaining the almost four year delay in bringing this information forward in the circumstances. He confirmed the irelavance and insignificance of the information provided by Mr. Yu  at the January 2014 without prejudice meeting when he stated for the record that this information was coming out for the first time now.

Continuing the obstructionist policy of BMO and their lawyers, Parley initially refused to let Mr. Yu answer questions involving the July 2012 meeting with Wendi’s lawyer Donald Baker. He eventually acknowledged the meeting but would not provide further detail. I see these as very relevant questions relating to the origin and development of this definitive evidence. It was relevant to this evidence to find out about its evolution, why it took almost four years to come out and why the vigourous efforts to conceal it.

Wendi never raised this evidence  of her meeting with Harold and Norman Yu in the entire course of the litigation. Why?

The answer is simple and strongly supported by the evidence. It is not true. Harold Laski did not say those things to Norman Yu. Norman, probably with help, made the story up after the fact to protect himself and BMO for his actions with Wendi and his conduct  in  mishandling the documents outside of the normal course of business under suspicious circumstances Most of this information only came into the hands of Wayne Laski over time through persistent efforts in the face of vigourous obstruction by Wendi and BMO.

For those questions left unanswered about the content, development, presentation, and four year delay in revealing  this crucial evidence, one has to wonder where were BMO’s lawyers? Why did they not ask the obvious questions? Perhaps because there are no reasonable believable answers.

There is another issue, related to BMO’s disgusting, fraudulent, callous and abusive conduct, not yet raised. This is the worst thing that BMO did. On top of improper dealings with Wendi to assist her in defrauding the estate and her brother. In addition to making up a story to protect themselves which they allowed to be repeated under oath. Further to allowing that evidence, which they did or should have known was false and would be damaging to Wayne financially to be put before a court in the hearing. They sat Wayne  in the room and tried to tell him that his father had lied to him. They told him his father deceived him. That Harold had lied when he confirmed to Wayne and his grand children, his desire and his intentions with respect to his estate. In light of the above, this was not true. It was most cruel and hurtful. Those involved on BMO’s side seemed to have no conscience or concern.

By their own evidence, this  information about Harold Laski’s intentions had been  intentionally and vigourously concealed  by be BMO for almost for four years. According to their evidence it had be concealed by Wendi and her lawyers for the same period of time as she would’ve heard it with Norman Yu on January 10, 2012.  The truth, supported by  Donald Baker’s admission, is that he had heard it, for the first time, in a secret meeting in July 2012. It was only revealed to Wayne just one month before the case was heard. It was not tested by thorough cross-examination in front of a fair and knowledgeable judge where these frivolous obstructive objections would not be upheld and these relevant questions would have to be answered. In almost 40 years of experience as a litigator, it is hard to imagine, given its suspicious history, contradictions, and unexplained four year delay in bringing it forward, evidence like Norman and BMO’s being given any weight.

The damage done  by their egregious fraudulent conduct was explosively devastating financially and emotionally. Wayne fought back. As a lawyer, he was in a position to do so. One can only imagine what abusive, self interested conduct they get away with inflicting on people who are not in a position to challenge them. Given the corporate culture at BMO exposed and encouraged here one can only shudder at the thought of trusting them with your retirement.

In this case, BMO’s defiant arrogance in the course of concealing and covering up their criminal conduct speaks volumes of how they see themselves and their place in society. They  demonstrated here that they feel they have right to cheat, lie, and abuse their clients and the public with impunity. They will put those lies before the court’s to protect their own interests even when they are wrong. This sense of entitlement is entrenched in their corporate culture where honesty, truth, and good faith are sacrificed to their own financial interests. They do it because they can. They do it because they have the money and power to crush almost anyone who challenges them.

There is another reason for the arrogance of BMO and other large institutions. They are often shown undue deference by the courts. Why would BMO lie? That is a question, in my experience, that is asked by judges as rhetorical. They often don’t  seek an answer. It  is not the institution that lies.  it is the human beings that are their employees.  Norman Yu made a point of the importance to him of new business. The constant pressure, in the accepted corporate culture, to produce and make money for themselves and their employers is sadly the norm. What lengths will some people go to succeed? It is limited only by the scope of human nature and the ethics of the individual involved. I do not think it is difficult to imagine what some people would do if they made a mistake or did something improper. What would they do to cover it up in the kind of culture BMO has demonstrated in this case?

If BMO, or any other institution, seriously encourages ethical behaviour and, takes proper steps when it is breached to demonstrate that it will not be tolerated, then, although financially responsible for the wrongdoing of their employees maintains their own ethical reputation and does the right thing to make it part of their corporate culture.

Sadly, that is not my experience generally with large institutions. They are arrogant and difficult to deal with.

In this case, BMO is more culpable than Norman Yu. That’s not to say that Norman Yu’s conduct did not demonstrate a complete lack of moral and ethical character. He is certainly someone I would never want to deal with and feel badly for anyone who does. BMO circled the wagons around Norman Yu and whoever at BMO helped and supported him. They embarked on a calculated, fraudulent, harmful course of action. They not only adopted and defended Norman’s conduct, but knowingly pursued of course of conduct  which continued to cause compounding damage to Wayne. They continue to defend their conduct to this day. They have learned nothing. They have just become  more emboldened. Norman’s conduct must reflect the corporate culture created at BMO. Their strenuous defence of his conduct, as well as their own, made their lack of a moral compass or conscience a clear reflection of that culture. From the top down.

This is the case that cries out for punitive damages. Punitive damages are awarded by courts, in addition to the actual damages, to punish and discourage especially egregious conduct. In Canada, the amount of punitive damages is tied to, and generally is not to exceed the actual damages. It will be argued that  this approach is woefully inappropriate in dealing with this kind of conduct by large rich institutions like BMO.  There are circumstances where the damage is relatively modest but the conduct clearly requires a punitive award.  For a rich institution, this would be insignificant and would not serve to discourage them or in any way encourage them to amend their behaviour and corporate culture. It would amount to no more than a mere license fee when they got caught. In order to be true to the intent of punitive damages, in such circumstances, the punitive damages should be significant enough to accomplish their stated purpose. In this case, in the event of a significant punitive damages award, a fund will be set up to assist others who are the victims of BMO and similar institutions.

If you or your parents have your investments with BMO I would move them to a smaller institution. I would stay away from any of the major financial institutions. I do not believe that this is by any means an isolated incident. This is just one where they got caught by someone willing to challenge them and follow through. The case continues. All of this will go before a jury who will be able to assess the evidence presented and pass judgement on the conduct of BMO and consequences of their actions.

 

the contents of this article are the opinions of the author as victim and litigant.