In addition to the recent fraud report we sent all members – click this link for a copy – for those of you who read AllNovaScotia, you will have recently seen an item on a matter from New Brunswick where a lawyer was the victim of a cheque scam. The lawyer sued the bank to recover his loss and though the bank was successful on a summary judgment application, the Court of Appeal allowed the lawyer’s appeal to reinstate his action. The final outcome is yet to be determined.
The scam this lawyer fell victim to is one we have warned the profession about on multiple occasions. We have discussed the various red flags you should see in these schemes to avoid sustaining a financial loss, and more importantly, a deficit in your trust account.
It is important to remind you that scams targeting lawyers continue unabated. You have to be diligent and aware. But, rather than repeating a list red flags, a different approach this time.
What follows are the factual findings of the N.B. Court of Appeal in Morrison v. The Bank of Nova Scotia, 2026 NBCA 83. Had the lawyer acted on any of the red flags these facts present, he might not have become the victim of this scam. In these factual findings we found at least ten red flags. To the first person who writes us with a list of eight or more of them, a lunch on the Halifax waterfront with your Director of Insurance:
[10] On December 10, 2021, Mr. Morrison received an email from an individual purporting to be Maria Tochi, seeking legal assistance to recover funds allegedly owed under a divorce settlement. She claimed to reside in New Brunswick but to be temporarily in Japan and provided a document bearing the name “Maria Micha,” said to be her passport.
[11] Mr. Morrison communicated with Ms. Tochi by email and telephone. Notably, one of the calls originated from Nigeria. He later acknowledged that he had not complied with the New Brunswick Law Society’s client identification rules, explaining that he wished to act quickly to advance his client’s interests.
[12] On December 16, 2021, Mr. Morrison received an email from “Micha Tochi,” who identified himself as Ms. Tochi’s former spouse and advised that he would send a bank draft in the amount of $200,000 to $300,000. On December 22, 2021, Mr. Morrison received what appeared to be a CIBC bank draft for $265,900, post-dated to December 24, 2021, accompanied by a letter purporting to be from a Calgary-based brokerage firm.
[13] On December 24, 2021, Mr. Morrison attended the Bank and dealt with a teller, Kathleen Shannon. As he intended to initiate a transfer from his trust account that same day, he asked that the draft be deposited without a hold. Because the amount exceeded her authority, Ms. Shannon sought approval from the Bank manager, Aimee Savoie, who approved the deposit without a hold.
[14] Mr. Morrison then requested an international wire for $100,000 from his trust account to a bank in Hong Kong, payable to an individual named Xiaoxia Liu, whose address was in China. Ms. Shannon pointed out the discrepancy between the location of the receiving bank and the recipient’s address.
[15] The wire transfer was initiated on December 24, 2021, but was not completed until December 29, 2021, due to early Bank closure on December 24 and delays in obtaining the necessary approvals over the holidays. On December 31, 2021, the bank was notified that the draft was counterfeit.
[16] As a result of the fraud, Mr. Morrison’s accounts were frozen and the sum of $265,900 was charged back to his trust account. By that time, $100,000 had already been withdrawn for the wire transfer along with a $115 service fee. Prior to the deposit of the fraudulent draft, the account balance was $15,342.04; that amount was also withdrawn at the time of the chargeback, leaving a negative balance of $84,777.96. Mr. Morrison replenished the trust account, and the freeze on his accounts was lifted.