Lawyer faces fraud charges

RCMP also lay charges of money laundering after raids on Etobicoke home, Concord law office

A two-year international drug investigation has led to the arrests of a 71-yearold lawyer and his employee, who now face charges of money laundering and possessing the proceeds of crime.

Lawyer Kenneth James of Etobicoke — who is also charged with fraud — has an extensive history of troubles, including a 2006 bankruptcy filing, past allegations of fraud and ongoing professional misconduct hearings.

But his co-accused, 61-year-old Rosemary Cremer, is known to her neighbours in Etobicoke as a sociable, “lovely” lady who seems to keep a low profile.

“I’ve known her for maybe 10 to 12 years,” said Pauline Firkin, who lives next door. “This is a complete shock.”

On Thursday, the RCMP executed a search warrant at Cremer’s modest bungalow on Willowridge Rd. Police also raided the Concord location of James’s law office, James and Associates, on Steeles Ave.

James and Associates, which also has an office in Brampton, was first searched in December, said RCMP Det. Insp. Derek Matchett, with Toronto’s Integrated Proceeds of Crime Unit.

Matchett said the criminal charges stem from a drug investigation launched by the RCMP in May 2010. That investigation — which has resulted in arrests and the freezing of more than $7 million in assets — is covered by a court-ordered publication ban so he cannot divulge any details, he said.

Bail proceedings against Cremer and James are also subject to a publication ban, Matchett said Friday afternoon.

But speaking prior to the ban, he said the RCMP alleges proceeds of crime were laundered through companies believed to be under James’s control, including James and Associates, Eveline Holdings Inc. and Sterling Capital Inc. “What we’re talking about is drug traffickers who make millions of dollars and then need to place that money into financial institutions — or to ‘clean’ it, for lack of a better word,” Matchett said. In a massive 2011 mortgage fraud case involving more than $5 million, a Superior Court judge noted that fraudulently obtained funds were moved through several accounts, including one belonging to James and Associates.

James has also been embroiled in several civil cases, including a 1990 lawsuit where he and several other defendants were accused of fraud and conspiracy by trustees of the Church of Jesus Christ of Latter-Day Saints.

The action was eventually discontinued by the church and then dismissed by a judge.

In 2006, James filed for bankruptcy and declared that he had $4,505,000 in liabilities and $1,418,500 in assets.

The Law Society of Upper Canada has accused him of professional misconduct involving mortgage transactions. The case is ongoing. With files from Kate Allen and Tara Walton