“Creation of fictitious sales”: two Montreal dealerships ordered to reimburse more than $1 million to Desjardins

A father and son who operate two used vehicle dealerships in Montreal have been ordered to repay more than $1 million to Desjardins for fraudulently selling cars to bogus customers.

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“The defendants had to ascertain the identity of the buyers. They are the sellers of motor vehicles. It was up to them to comply with their contractual obligations under the Convention,” wrote Judge Marie-France Vincent in a recent judgment.

By ruling in favor of the Fédération des caisses Desjardins du Québec, the magistrate put an end to civil proceedings against Wazir Mohammad and his son Jamil which have dragged on since the fall of 2017.

The two men run Auto Jawa and Diamond Auto et Transport, on a lot on Gouin Boulevard West, in Montreal.

They were accused of having established “a fraudulent scheme by creating fictitious sales”.

With the financing of the vehicles by Desjardins, they managed to pocket “hundreds of thousands of dollars,” it was alleged.

Numerous irregularities

According to the evidence, the duo sought to thwart Dealertrack, a system for assessing customers’ risk levels.

“Certain prerequisites result in automatic authorization, failing which a credit analyst intervenes. For example, the professions of doctor and lawyer improve the system’s algorithm for granting funding,” explains the judgment.

Moreover, out of 62 clients associated with 50 detailed court transactions, more than the majority of them allegedly worked in these areas.

“The Court seriously doubts it,” writes Judge Vincent.

And the numerous irregularities do not stop there.

The majority of buyers act as “nominees”, “a key element of a fictitious sale with the aim of defrauding the lending financial institution”, we read.

In 38 cases, the vehicle was not registered in the customer’s name upon delivery. In 18 others, the health insurance cards used to identify the consumers were false.

Several cars were not the property of Auto Jawa when the sales contract was signed. Some were not in Quebec, or even in Canada.

The evidence convinced the court that an amount of more than $860,000 was owed to Desjardins, who was also able to seize vehicles.

Abuse

In a more recent decision, another tile fell on the heads of Wazir and Jamil Mohammad.

The court determined that they had committed an abuse of process in this case which stretched over six years, so that they must pay nearly $275,000 in compensatory damages.

Judge Vincent cites the example of repeated requests having slowed down the hearings.

Note also that of the 50 buyers who were supposed to testify, only one finally showed up. He claimed to be a janitor, while Jamil Mohammad believed him to be a lawyer.

Jamil Mohammad’s sister, Nazrine, was also targeted in the lawsuit.

In 2021, she bought out her brother’s share in the building where the family lives to prevent Desjardins, in all likelihood, from seizing the premises in the event that the courts authorize the institution’s financial claim, according to the judgment.