The total misappropriation may top $20 million. Several buildings have filed civil suits against Channel and Khan, who is thought to have fled the country. Police are investigating.
Some condo corporations allege Khan forged signatures and created fake meeting minutes to register a bylaw that allowed him to obtain loans without the board’s knowledge. The money was funnelled into a separate bank account.
Residents in some buildings across Greater Toronto are now on the hook for these outstanding loans, while others are talking with insurance companies and lenders to figure out who must foot the bill.
Whether condo owners will be left to cover the costs depends on the details, said real estate lawyer Ray Mikkola of law firm Pallet Valo.
“Where the management agreements specifically authorized the manager to bind the corporation, and if the board could have detected the fraud but recklessly or negligently failed to do so, or if the corporation benefitted from some of the money. . . the corporation may be in trouble,” Mikkola said.