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Date First Reported: April 2015

Primary Name Associated: Michael Kapoor

Description of Potential Fraud:

fraud-warning

Nine Ontario firms, one US firm and one Aruba firm notified us that they received an email from the purported Michael Kapoor looking to retain them with regards to a breach of a business loan agreement.

This is a classic bad cheque scam that presents as legal matter requiring the assistance of a lawyer. In this scam lawyers will be duped into wiring real funds from their trust accounts after depositing a fake cheque received as payment from the debtor (who is part of the fraud). See our Confirmed Fraud Page for more of an explanation of how these frauds work and other names associated with it , and our Fraud Fact Sheet for a list the red flags of a bogus legal matter that is really a fraud.

Here is the initial contact email sent by the fraudster and subsequent reply:

From: Micheal Kapoor [mailto:[email protected]]
Sent: April-16-15 12:37 PM
To: Info
Subject: Micheal Kapoor

Hello Counsel,

My name is Micheal Kapoor, I am seeking your assistance in the
litigation of a debt owed to me. I am searching for a lawyer that will
assist me in writing a formal demand letter to my debtor, file a law
suit when necessary and generally represent me. Please advise if this
is your area of practice so I can send you more information.A referral
would be welcomed if this is not your area of practice

Replying to the email brought this response:

Thanks for taking time off your busy schedule to attend to my issue. Below is the name of the debtor for your conflicts checks:-

Debtors Name – Andrew Rose
Toronto,ON

I am sorry for the late response but I only just saw your mail in my spam folder. Attached is a copy of the agreement in PDF format for your review. Andrew Rose (Borrower) has been a longtime business partner, but lately we have walked our separate ways. We both deal on heavy duty equipment sales and rental services. He has borrowed money from me in the pass without no issues and to be honest with you, he has helped me too in the pass. And that’s why I am hoping we can settle this issue out of court.
In winter of 2014 he went through some financial difficulties with his business and I gave him a loan for $585,000 in Jan/13/2014 for a year at 7.5% interest which was due this Jan/13/2015.He has only paid back $100,000.00. till date,with $485,000 plus interest outstanding.
I have contacted him a few times about the balance of the loan and he promised to pay back,which is not good enough for me. For he has promised and failed to pay so many times. I don’t see why I should believe him now to make good in is promises. I can’t continue to wait and hope, while his business is striving and mine suffering. To be honest with you, he’s simply giving me the run around.
I know the threat or possibility of litigation would serve as a cause to make him pay sooner rather than later. And I also know this may require paying a reasonable retainer or collection cost which I am willing to pay once I get and reviewed your engagement letter. I am hoping this will be a non-litigation matter but I am prepared to litigate this issue if Mr. Rose is not ready to pay back the funds based on our terms of agreement.
Please email me a copy of your engagement letter to better understand your terms and conditions. And also to proceed with this issue with Mr.Rose.

I also want to bring it to your attention that this loan has caused a great strain of hardship on my business and operational capital.

Warmest Regards,
Michael Kapoor
DEVELOP & CO LTD

How to handle a real or suspected fraud

If you have been targeted by any of these frauds, please forward any of the emails and supporting documents that you have received to [email protected]

If you are an Ontario lawyer who suspects you are acting on a matter that might be a fraud, call LAWPRO at 1-800-410-1013 (416-598-5899). We will talk you through the common fraud scenarios we are seeing and help you spot red flags that may indicate you are being duped. This will help you ask appropriate questions of your client to determine if the matter is legitimate or not. If the matter you are acting on turns out to be a fraud and there is a potential claim, we will work with you to prevent the fraud and minimize potential claims costs.

What can you do to help put a stop to the fraud attempt? You can simply stop replying to the fraudster’s emails or inform them that you suspect fraud and will not act on the matter (or will take no further actions on the matter). You can report the fraudsters email addresses to the email hosting company. If you have a fraudulent cheque you can destroy it or send it to the fraud department of the financial institution, which may wish to see it. In Canada, you can report the fraud to the Canadian Anti-Fraud Centre.

We are often asked if it is worthwhile to report the fraud attempt to the police in the hopes of helping catch the fraudsters. You can certainly report the fraud to your local or federal law enforcement agencies, but unfortunately it is often difficult, expensive and time consuming for them to attempt to shut down these online fraud perpetrators (though there are some successes).

If you have been successfully duped, please immediately notify LAWPRO as there may be a claim against you. Instructions on how to report a claim are here.

For more immediate updates on fraud and claims prevention, subscribe to the email or RSS feed updates from LAWPRO’s AvoidAClaim blog.

Fraud Fact Sheet More fraud prevention information and resources are available on the practicePRO Fraud page, including the Fraud Fact Sheet, a handy reference for lawyers and law firm staff that describes the common frauds and the red flags that can help identify them.