Toronto lawyer couple sentenced to prison for contempt of millions in missing homebuyer funds

A Toronto lawyer couple has been sentenced to prison for contempt of court after months of failing to comply with orders to provide records and information about millions in funds missing from their firm’s trust account.

Husband and wife Nicholas Cartel and Singa Bui were ordered to remain in provincial custody for 30 days on Friday.

It’s rare, but not unprecedented, for lawyers to end up in jail for contempt, and that usually only happens in the most extreme cases, legal experts say previously told CBC News.

The cartel’s punishment is effective immediately. He was handcuffed by a court officer and taken from a Toronto courtroom just after 2:30 p.m.

Bui will serve her sentence immediately after the cartel, starting from November 26.

The couple and their law firm, Cartel & Bui LLP, were sued by 25 home buyers and sellers. more than $6.5 million of their money was misappropriated from the company’s trust account, primarily between April and December 2023. Many of these plaintiffs have already obtained default judgments.

The judge said he would not simply impose fines for the contempt since the two attorneys already owe millions of dollars to the plaintiffs.

“No regrets,” says the judge

As part of the lawsuits, dating back to January, several judges had ordered Cartel and Bui to make full disclosures about their and their company’s finances and answer questions about where the missing money went.

But in findings released in late August, Supreme Court Justice William Chalmers ruled that while the couple “must know what happened to the funds, they have refused to provide this information.” He said Cartel and Bui “took active steps to conceal their finances and frustrate the court.”

In his judgment, read out on Friday afternoon, Chalmers said that “Mr Cartel and Ms Bui have shown no remorse for their conduct.”

“The defendants continue to ignore court orders and misrepresent facts to the court,” he said.

He also outlined aggravating factors, such as the fact that both suspects are experienced lawyers and therefore very familiar with the legal system and the importance of complying with court orders.

Moreover, Bui’s travel history — now available after she finally surrendered her passport — shows that she flew to Zurich, Switzerland, and Milan, Italy, the same month most of the money went missing, the judge noted.

Bui also flew to Portugal at the end of September and returned in October, the court heard – four months after Judge Chalmers ordered her to surrender her passport so she would not leave the court’s jurisdiction.

Be silent while hearing

Andrew Wray, Bui’s newly hired attorney, argued that the trip came at the expense of Bui’s boyfriend, who was concerned about her mental health and took her to Portugal to “let her sleep.”

“She was apparently able to travel to Portugal, but was unable to comply with court orders,” Chalmers said in his ruling.

Chalmers accepted that while the surrender of the passports of both Cartel and Bui is a mitigating factor, many court orders to hand over materials have remained unfulfilled.

During the hearing, Bui remained silent and kept her gaze generally downcast as she worked her way through a box of Kleenex, but was denied water by her lawyer.

Cartel, meanwhile, remained self-represented, submitting nearly 400 pages of documents just hours before the hearing. The judge did not accept the documents as evidence, calling it “further evidence of his contemptuous behavior.”

The only question the Cartel asked the judge before he was handcuffed was whether he would have access to a laptop while in custody so he could continue working on his case, or whether he would have to give instructions to others while in captivity. The judge told Cartel to “figure it out.”

Wray did not respond when asked to comment on Bui’s behalf outside the courthouse.

Suspension of the law society, police investigation

Both lawyers were provisionally suspended in April by the Law Society of Ontario while it continues to investigate the case. The Toronto Police Fraud Team is also investigating.

Although Cartel has acknowledged that he is financially liable to the plaintiffs who sued because he was a partner in the now-defunct law firm, he has consistently denied responsibility for the embezzlement and blamed it on his wife.

In December, Bui said in a letter to the Law Society of Ontario through a lawyer that Cartel “was not responsible for the improper transfer of trust funds, nor was any other employee or employee of the company.”

Bui will return to court on November 18, about a week before she is scheduled to begin serving her sentence. If she follows the outstanding court orders and declares her contempt, she can ask for a reduced sentence. Under Friday’s ruling, she can also apply to serve that sentence in a psychiatric facility while she receives treatment.

Likewise, if Cartel expresses contempt while in custody, he can also petition to reduce the sentence.

Trung Nguyen, the plaintiff’s attorney who petitioned the court to hold the couple in contempt, declined to comment on behalf of his clients.

Meanwhile, four victims who attended the hearing told CBC News they still have not received their money back from Cartel and Bui.

‘Light at the end of the tunnel’

Anthony Ingarra, one of the prosecutors charging Cartel and Bui, said that while “we’re not even close” to getting the missing money back or knowing where it is, he now has “a light at the end of the tunnel.” sees.

“I actually saw Judge Chalmers saying, ‘You guys aren’t kidding me. I see what you guys did,'” Ingarra said after the sentencing, adding that he thought the 30 days in prison was “good.” ‘ and ‘quite heavy’.

However, he emphasized that he is still dissatisfied.

‘They’re still hiding [the money]and the fact that Singa is essentially traveling around the world while this is going on sickens me,” he said.