Former bureaucrats accused of the alleged theft of $11 million from Ontario’s COVID-19 relief funds have spent more than $1.1 million on their legal defense – and are now asking for another $1.4 million.
That’s according to documents filed in Ontario Superior Court on Tuesday by crown attorneys who want to block Sanjay and Shalini Madan from further access to their assets.
The Madans, a married couple from Toronto, were laid off from their IT jobs at Queen’s Park in 2020 after an alleged pandemic aid fraud.
In civil court filings, the province alleges that “some or all” of the Madans, their adult sons Chinmaya and Ujjawal, and business partner Vidhan Singh, also of Toronto, funneled millions of dollars to thousands of TD, Banque of Montreal, Royal Bank of ICICI bank accounts of Canada, Tangerine and India in 2020.
The OPP also charged Sanjay Madan with two counts of fraud and two counts of breach of trust. He and Shalini Madan were also charged with laundering the proceeds of crime and possessing stolen property.
Singh has been charged with money laundering, fraud and possession of stolen property and Manish Gambhir of Brampton has been charged with possession of stolen property and possession of identification related to – or purporting to relate to – a other person.
Although Chinmaya and Ujjawal face no criminal charges, they are part of the civil action. Both have denied any wrongdoing.
None of the province’s allegations have been proven in civil or criminal court.
Until his dismissal, Sanjay Madan was the $176,608-a-year tech leader of the Support for Families program, which offered parents $200 per child under 12 and $250 per child and youth under 21 with special needs for online education expenses at the start of the pandemic. .
In testimony in civil court, which cannot be used against him in the criminal case if he violates his Charter-protected rights against self-incrimination, he said he had ‘relaxed’ computer security so that more payments can go to the same bank accounts.
“There were a lot of possible applications because people… found out there were a lot of gaps,” Sanjay Madan told civil court in January 2021.
“I thought there might be an opportunity to withdraw the funds…it seemed like easy money to me.”
Shalini Madan, who was laid off from her $132,513-a-year IT job, has denied any involvement in the alleged theft and is suing the province for wrongful dismissal, seeking more than $5 million in damages.
Their sons, who voluntarily resigned from lower-level IT jobs at Queen’s Park two years ago, are suing the government for $1million each, claiming ‘psychological’ harm by being named in the civil action.
A provincial government court injunction, obtained in the civil case, froze $28 million of Madan assets in Canada and India.
This includes $12.4 million in cash in Indian bank accounts, an $8 million apartment complex in Waterloo, a seven-bedroom house in North York worth $2.57 million and six condominiums in Toronto worth about $3 million.
According to new court documents, the Madans would like to sell the North York home and one of the condos to fund their defense.
But Crown attorney Christopher Wayland alleged the purchase of these properties may have used money ‘obtained by fraud’ through an elaborate ‘kickback scheme’ which stole 30 million additional dollars dating back to 2010.
Wayland alleges that Sanjay Madan and Singh, who denies the allegation, operated a consulting business scheme that hired government IT contractors in exchange for “secret commissions” from preferred vendors.
In his factum, Crown counsel said “to date, the court has paid the Madan defendants $846,479.32 for their civil defense and $258,500 for the criminal defense.”
“They are now seeking an additional $1.4 million+ for their civil and criminal defense,” Wayland said.
“While the criminal accounts estimate the cost of closing cases, it is premature at this stage to release funds for trial preparation which is not expected to begin until fall 2023,” he said.
“Most importantly, the two accounts submitted on behalf of Sanjay and Shalini Madan indicate that they are currently engaged in resolution discussions, which may mitigate the need for a trial.”
Wayland argued that the North York home could be sold, but only $242,226.35 “of the equity” would be returned to the Madans, with the rest of the proceeds held in court.
A judge is expected to rule on the matter this summer.
Christopher Du Vernet, the Madans’ lawyer, countered that the province was trying to thwart the couple’s ability to mount an adequate legal defense.
“The Ford government is trying to starve the Madans into submission rather than fight on merit,” Du Vernet said last summer.
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