



COURT OF APPEAL
    FOR ONTARIO

CITATION: R. v. Kenegarajah, 2018 ONCA 121

DATE: 20180208

DOCKET: C56562, C56593, C56594, C57374, C62486 and C63299

Watt, Hourigan and Miller JJ.A.

DOCKET: C56562
    and C63299

BETWEEN

Her Majesty the Queen

Respondent

and

Ramanan Kenegarajah

Appellant

DOCKET:
    C56593

BETWEEN

Her Majesty the Queen

Respondent

and

Rajitha Kanagarajah

Appellant

DOCKET:
    C56594

BETWEEN

Her Majesty the Queen

Respondent

and

Anantha Neeranjan

Appellants

DOCKET:
    C57374 and C62486

BETWEEN

Her Majesty the Queen

Respondent

and

Kuhen
    Neshan

Appellants

Michael Dineen, for Anantha Neeranjan

Ian Kasper, for Rajitha Kanagarajah

Mark Halfyard, for Kuhen Neshan

Ian Smith, for Ramanan Kenegarajah

Michael Bernstein, for the respondent

Heard: November 20, 2017

On appeal from the convictions entered on October 12,
    2012 by Justice Joseph A. De Filippis of the Ontario Court of Justice, with
    reasons reported at 2012 ONCJ 636.

Hourigan J.A.:

Introduction

[1]

The appellants were tried on an Information containing over 100 counts
    related to a large-scale credit card fraud and money laundering scheme that
    operated over several years. They were convicted of various offences, including
    fraud over $5,000, participation in a criminal organization, identity theft,
    possession of property obtained by crime, and money laundering.

[2]

The appellants raise various grounds of appeal, some unique to their
    individual cases and some that overlap among some or all of them. These grounds
    of appeal are considered in detail below. In summary, I would dismiss all of
    the appeals, save for that part of Ramanan Kenegarajahs appeal wherein he
    submits that he was convicted of counts with which he was not charged.

Facts

[3]

The following brief factual summary is sufficient to place the issues in
    these appeals in context.

[4]

A bust out fraud starts with a perpetrator gaining access to a
    persons bank or credit card account and then creating a fraudulent credit
    profile. A credit card is applied for and issued by a financial institution.
    The low initial credit limit is gradually increased after the fraudster makes a
    series of small purchases and payments. Once the credit limit is increased to a
    sizeable amount, the fraudster makes large purchases and obtains cash advances.
    They then abandon the credit card, leaving the financial institution that
    issued it with an unpaid debt.

[5]

Before considering the circumstances of the charges, it is helpful to
    identify the appellants and their interrelationships. Mr. Kenegarajah (formerly
    known as Kanagarajah) is the brother of Rajitha Kanagarajah. Kuhen Neshan is
    married to Anantha Neeranjan.

[6]

In 2001, authorities were alerted to suspected bust out frauds
    discovered by the Manager of Security at American Express (AMEX). Mr. Neshan,
    an employee of AMEX, came under suspicion and inquiries into his activities
    revealed that he accessed 21 different credit card accounts. Although police
    investigated the frauds and conducted a search of a Toronto residence in
    connection with Mr. Neshan, he was never charged in relation to these
    activities.

[7]

In 2007, police in British Columbia investigated reports that Mr. Neshan
    and Mr. Kenegarajah were involved in financial impropriety at a Hindu temple. The
    police located the men and maintained surveillance on them. Mr. Kenegarajah was
    arrested for fraud. Ultimately, however, the Crown in British Columbia did not
    prosecute Mr. Kenegarajah.

[8]

The story resumes in Ontario in 2009. The Durham Regional Police
    investigated a complaint from a British Columbia resident regarding fraudulent
    credit cards that were opened in his name, one of which had been used at an
    automobile store in Markham, Ontario. The police determined that the
    transaction was linked to a 2008 Land Rover leased to Ms. Kanagarajah. Further
    investigation revealed that a 2001 Audi A6 was also registered to Ms.
    Kanagarajah.

[9]

The police conducted surveillance on these vehicles, which revealed a
    pattern of activity by Mr. Neshan and Mr. Kenegarajah. On weekday mornings the
    two men would leave from 30 Bissland Drive, Ajax, and travel throughout the
    Greater Toronto Area, conducting various bank transactions, visiting retail
    stores and post office boxes, and using credit cards in other peoples names.
    Throughout the day they would stop off at 30 Bissland Drive and other
    residences. They were never observed attending a legitimate place of employment
    or business. The police believed that the activities were consistent with a
    pattern of bust out frauds.

[10]

On
    March 3, 2010, Mr. Neshan and Mr. Kenegarajah were stopped by police while driving
    the Land Rover, and arrested. Cash, credit cards in the names of other people,
    gift cards, cheques in the names of other people, bank receipts, ledger books
    containing handwritten names, addresses and other data, were all seized.

[11]

Search
    warrants were executed at 30 Bissland Drive, Ajax and at 311-11753 Sheppard
    Avenue East, Scarborough. Among the material seized as a result of the search
    warrants were over 50 credit cards in the names of people other than the
    accused, data for several individuals and financial institutions, over $100,000
    in cash, multiple mobile phones, electronics and other luxury goods. The
    records for the mobile phones were accessed and revealed over a thousand calls
    to six financial institutions.

[12]

Multiple
    charges were laid against the appellants. The Crown submitted that over a
    period of 10 years Mr. Neshan and Mr. Kenegarajah primarily carried out the
    bust out frauds, assisted by the other appellants. The Crowns case consisted largely
    of evidence from the affected financial institutions, surveillance evidence,
    and evidence from the searches.

[13]

At
    the end of their trial, counsel for Mr. Neshan and Mr. Kenegarajah brought a
    motion to have certain counts quashed on the basis that they violated the
    single transaction rule as set out in s. 581(1) of the
Criminal Code of Canada
,
R.S.C., 1985, c. C-46. The trial judge found, however, that each of the
    impugned counts alleged a single transaction and complied with s. 581(1).

[14]

The
    trial judge dismissed the conspiracy charges as against all defendants. Mr.
    Kenegarajah and Mr. Neshan were found guilty of the global charges of fraud,
    money laundering, and participating in a criminal organization as well as most
    of the other substantive counts. Ms. Neeranjan and Ms. Kanagarajah were also found
    guilty of participating in a criminal organization and a few other substantive
    counts.

Issues

[15]

The
    issues raised in these appeals and my conclusions on each issue may be
    summarized as follows:

(i)

Did counts in the Information against Mr. Kenegarajah
    and Mr. Neshan offend the single transaction rule in violation of s. 581(1) of
    the
Criminal Code
?

No.
The impugned counts were broadly
    framed, spanned a number of years, encompassed multiple transactions in
    different locations and, in some cases, involved different or additional
    perpetrators. However, there is no basis to conclude that the trial judge erred
    in dismissing the motion to quash. He identified and applied the correct legal
    principles and appropriate factors that are relevant in determining whether a
    count violates the single transaction rule. The trial judges conclusion was
    justified based on his finding that the appellants conduct amounted to a
    single, large-scale fraudulent scheme and that they suffered no prejudice as a
    consequence of how the counts were framed.

(ii)

Did the trial judge convict Mr. Kenegarajah on
    counts for which he was not charged?

Yes. It would appear that through inadvertence
    the trial judge entered convictions on counts for which Mr. Kenegarajah was not
    charged. While he was not sentenced on these counts, the convictions must be
    quashed.  There was also a typographical error regarding convictions on count 1
    versus count 2 that must be rectified.

(iii)

Did the trial judge provide insufficient reasons and err in finding
    beyond a reasonable doubt that Ms. Neeranjan had knowledge and control of
    property obtained by crime?

No. The trial judge provided sufficiently
    detailed reasons in convicting Ms. Neeranjan on the counts of possession of
    property, including currency, obtained by crime over $5,000. The convictions were
    well rooted in the evidence and free of legal error.

(iv)

Did the trial judge err in concluding that Ms.
    Kanagarajah obtained a mortgage on the strength of a false employment
    confirmation letter?

No. There was compelling evidence to ground an
    inference that the employment confirmation letter was relied upon by the
    complainant in authorizing the mortgage transaction.

(v)

Did the trial judge err in finding that
Ms.
    Kanagarajah and Ms. Neeranjan knowingly
participated in a
    criminal organization?

No
.
The trial judge did not err
    in his application of the test for a criminal organization or otherwise err in
    law. There was ample evidence that demonstrated they were members of a criminal
    organization and knowingly participated in its activities to facilitate or
    commit indictable offences.

Analysis

(i)

Single Transaction Rule

[16]

The single transaction rule is set out in s. 581(1) of the
Criminal
    Code
:

581(1) Each count in an indictment shall in general
    apply to a single transaction and shall contain in substance a statement that
    the accused or defendant committed an offence therein specified.

[17]

On appeal, Mr. Kenegarajah and Mr. Neshan submit that the trial
    judge erred in failing to quash the following eleven counts for violating the
    single transaction rule:



Ct.

Offence

Complainant

Time period



1

Fraud over $5,000

the public

Jan. 1, 2001 - March 3, 2010



3-10

Fraud over $5,000

Each count related to a
          different financial institution: Bank of Montreal Mastercard, JP Morgan
          Chase, Canadian Tire Mastercard, MBNA Canada Mastercard, Capital One
          Mastercard, HBC Mastercard, CIBC Visa, American Express

Jan. 1, 2001 - March 3, 2010



64

Impersonation

numerous victims

Jan. 1, 2001 - March 3, 2010



92

Money laundering

n/a

Jan. 1, 1997 - March 3, 2010



[18]

These
    appellants submit that the trial judge failed to engage in the proper analysis
    of the single transaction rule.  Instead, he focused on the lack of prejudice to
    these appellants and their failure, earlier in the trial, to object to the
    counts or to seek a remedy such as particulars or severance. These appellants
    also submit that the trial judge failed to consider that relaxation of the
    single transaction rule is only permissible in exceptional circumstances, none
    of which were present in this case. With respect to prejudice, these appellants
    submit if it is necessary to show prejudice, that they were prejudiced by how
    the counts were framed.

[19]

Mr.
    Kenegarajah and Mr. Neshan further submit that the evidence established that
    the alleged fraudulent activity consisted of a number of discrete transactions,
    which should have been charged separately.  They note that the counts span an
    extended length of time (9 years and 13 years) and that, within the charge
    periods, there were extended gaps where there was no evidence of fraudulent
    activity.  They also emphasize that the alleged activities victimized different
    individual and institutional complainants, occurred in different locations and
    involved different perpetrators (
i.e.
not every accused was involved in
    each of the fraudulent transactions).  The combined effect of these factors is
    that the counts, as particularized, cannot be considered a single transaction.

[20]

Finally,
    these appellants rely on similarities between the facts of their case and this
    courts decision in
R. v. Rafael
,
[1972] 3 O.R. 238 (C.A.) in
    submitting that the trial judge erred in finding that the conduct in this case
    could be considered a single transaction.

[21]

I
    would not give effect to any of these arguments and would dismiss this ground
    of appeal.

[22]

Mr.
    Kenegarajah and Mr. Neshan are correct in submitting that their failure to
    raise the single transaction rule earlier in the trial, or to seek a remedy
    such as severance or particulars, is not fatal to this ground of appeal. It is,
    however, a telling indicator that the accused [were] not prejudiced by the
    indictment as drafted:

R. v. S. (H.S.)
, 2009 ONCA 102, 265
    O.A.C. 206, at para. 25. See also:
R. v. K. (C.)
(1999), 127 O.A.C.
    261, at para. 11 (C.A.).

[23]

Counsels
    arguments regarding prejudice must be considered in light of the underlying
    purpose of the single transaction rule: to ensure that an accused is aware of
    the charge against him or her and is able to make full answer and defence:
R.
    v. Chamot
, 2012 ONCA 903, 302 O.A.C. 104, at paras. 36-37;
R. v.
    Katigbak
, 2011 SCC 48, [2011] 3 S.C.R. 326, at para. 82. The validity of a
    count is to be assessed in light of this purpose.

[24]

Avoiding
    prejudice is the underlying purpose of the single transaction rule, and the
    presence (or absence) of prejudice is therefore a critical component of the
    test to determine whether a particular count offends that rule.  The
    significance of prejudice is also reflected in s. 590(2) of the
Criminal Code
,
    which allows an accused to seek remedies in respect of a count that offends the
    single transaction rule, but only on the ground that the count, as framed,
    embarrasses him in his defence.

[25]

A
    lack of prejudice was a significant  if not determinative  factor in
Katigbak.
There, the Supreme Court of Canada
    concluded
that the impugned count was not invalid for violating the
    single transaction rule, even though it would have been preferable to divide
    the count.

[26]

Similarly,
    the significant role that the presence (or absence) of prejudice plays in
    determining whether a count is invalid due to violating the single transaction
    rule is reinforced by a brief survey of the decisions of this court.  In the
    following cases this court cited a lack of prejudice to the appellant in
    dismissing an appeal on this ground:
S. (H.S.)
,
at para. 24;
K.
    (C.)
, at para. 11;
R. v. Canavan
,
[1970] 3 O.R. 353
    (C.A.), at paras. 17-19;
R. v.
Hulan
,
[1969] 2 O.R. 283 (C.A.), at paras. 29 and
    32-33.
In contrast, in the following two cases this court cited
    prejudice to the appellant in allowing an appeal on this ground:
R. v.
    Selles
(1997), 34 O.R. (3d) 332 (C.A.), at paras. 33-36; and
R. v. Monk
,
    [1988] O.J. No. 94 (C.A.), at paras. 17-19.

[27]

In
    oral submissions counsel for Mr. Neshan submitted that these appellants were
    prejudiced because there were potential issues or defences that could have been
    raised, for example, the existence of a potential alternative suspect in
    relation to the 2001 AMEX activity.  In my view, this argument fails to establish
    prejudice.  Even assuming that any such potential defences existed, the
    appellants have not demonstrated that it was somehow not open to them to pursue
    those defences because of how the Information was drafted.

[28]

I
    note as well that the trial judge granted a similar fact application due to the
    interwoven and interrelated nature of the offences.  Therefore, even if the
    impugned counts had been divided, evidence in relation to each count would have
    been admitted and been available for use as similar fact evidence across all
    counts.

[29]

It
    must be noted that the defence strategy at trial was simply to hold the Crown
    to the strict proof of its case.  To paraphrase the conclusion of McLachlin
    C.J. and Charron J. in
Katigbak
, there can be no suggestion that the appellants
    in this case were not aware of the case they had to meet at trial, or that they
    were somehow hampered in conducting their defence.  It is not sufficient to
    say, as counsel did in his oral submissions in this case, that the framing of
    the counts
could
have affected how the appellants conducted their
    defence.

[30]

Mr.
    Kenegarajah and Mr. Neshan submit that the trial judge failed to acknowledge or
    appreciate that relaxation of the single transaction rule is permissible in
    exceptional circumstances only, and is not the norm. In my view, the
    appellants submission about what qualifies as an exceptional case is too
    narrow. A case will fall within the exception to the single transaction rule as
    long as the acts encompassed within the count can be treated as one
    transaction.

[31]

In
R. v. Rocchetta
, 2016
    ONCA 577, 352 O.A.C. 130, at para. 44, this court identified the different
    factors that may make a series of acts a single transaction:

A series of acts that are sufficiently
    connected will make up a single transaction for the purposes of s. 581(1). The
    sufficiency of the connection will depend on the circumstances. The requisite
    connection may be established by the proximity in time or place of the acts,
    the identity of the parties to the acts, the similarities of the conduct
    involved in the acts, the ongoing relationship of the parties to the acts, or
    other factors tending to show that each act is properly viewed as part of the
    larger whole: see
R. v. Hulan
, [1969] 2 O.R.
    283
(Ont. C.A.).

[32]

Applying
    these factors to the present case, the trial judge was justified in finding
    that the conduct amounted to a single transaction.  While the acts did not
    necessarily share proximity in time, place or complainants, the trial judge did
    find that they shared strong similarity in the nature of the conduct involved; the
    conduct was part of a large and sophisticated bust out fraud scheme perpetrated
    by both these appellants over several years.

[33]

Finally,
    the appellants rely on what they submit are factual similarities between their
    case and this courts decision in
Rafael
.  However,
Rafael
involved allegations of fraud carried out over a period of five years, involving
    24 different complainants.  After reviewing a number of authorities, including
Hulan
and
Canavan
, the court, at paras. 18-19, found that the conduct did
    not amount to a single transaction:

The result therefore was that this became an indictment in
    which 24 persons were alleged to have been defrauded, on dates varying widely
    in time, by offences taking place at different localities and involving
    different amounts, but more importantly, involving also quite different
    representations to the individuals who were called as witnesses.

After careful consideration, we are not able to conclude that
    the events which the Crown proved in this case can be regarded as occurrences
    which together form a single transaction.

[34]

These
    appellants submit that
Rafael
is more consistent with the facts of
    this case than the authority relied upon by the trial judge. I disagree. In
Rafael
,
    the most significant consideration identified by the court was that the nature
    of the impugned conduct in relation to each complainant was inconsistent. This
    is reinforced by how the court in
Rafael
characterized the material
    facts in
Hulan
and in
Canavan
, at paras. 10 and 15,
    respectively, emphasizing that the presence of a similar pattern of conduct in
    those cases led to a different result
.
Mainly, to a finding that the
    single transaction rule was not violated.

[35]

In
    my view,
Rafael
should be distinguished on the basis that, in the
    present case, the trial judge found that the nature of the impugned conduct was
    similar. The various offences encompassed by the counts were part of a global
    bust-out scheme operated for several years by the appellants.

[36]

In
    summary, I am not satisfied that the trial judge erred in his analytical
    approach to this issue. He was entitled to consider the appellants failure to
    raise the single transaction rule or to seek a remedy earlier in the trial. He
    was also justified in emphasizing the lack of any prejudice suffered by the
    appellants. It is clear from his reasons that, notwithstanding finding a lack
    of prejudice, the trial judge went on to consider, based on an application of
    the appropriate legal principles to the evidence and circumstances of the case,
    whether the various incidents of impugned conduct in the case before him were
    so closely related as to amount to a single transaction. It follows from the
    foregoing that I would reject this ground of appeal.

(ii)

Errors Regarding Counts

[37]

After
    a careful review of the Information and the trial judges reasons, it is clear
    that Mr. Kenegarajah was convicted of counts for which he was not charged.
    Crown counsel has provided this court with a sentencing document that clarifies
    that this appellant was not sentenced on these charges. While that is of some
    comfort, the fact remains that Mr. Kenegarajah was convicted of offences with
    which he was not charged. An order will go quashing Mr. Kenegarajahs convictions
    on counts 53, 56, 58, and 59.

[38]

In
    addition, there is a typographical error in the trial judges reasons. He
    acquitted all of the accused on count 2 yet entered a conviction for Mr. Kenegarajah
    and Mr. Neshan on this count in his reasons and the Information. It is clear
    that he entered the conviction on count 2 instead of count 1. For these two
    appellants, the convictions on count 2 will be quashed and acquittals will be entered.
    In addition, for these two appellants, convictions will be entered on count 1.

(iii)

Possession of Property Obtained by Crime

[39]

Ms.
    Neeranjan submits the trial judge failed to provide sufficient reasons in
    support of his finding that she had the requisite knowledge and control of
    property obtained by crime. She further submits the trial judge relied on
    speculation rather than evidence in convicting on these counts, and that he
    erred in finding that wilful blindness could be inferred.

[40]

The
    trial judge provides reasons for the conviction on these counts, at para. 158,
    as follows:

Kenegarajah, Neshan, and the latters wife, Anantha
Neeranjan
are charged with possession of property by
    crime, namely furniture, electronics, and appliances (count 55) and money
    (count 57) on March 3, 2010. Counsel for
Neeranjan
submits
    there is no proof that she knew about her husbands activities. The uncontradicted
    evidence belies this submission. The most important relevant paragraphs are 60,
    62, 64, 67 and 70 with respect to the search warrant at 30 Bissland Drive. The
    home was filled with the proceeds of crime, including furnishings, credit
    cards, cell phones and money stashed in various places. All items would be in
    plain view or accessible to the woman of the household. There is nothing to
    suggest
Neeranjan
could reasonably believe the two
    men were lawfully employed. There is nothing to suggest she could reasonable
    believe the property was legitimately purchased or that there was some
    plausible explanation for why over $100,000.00 was strewn about, rather than
    deposited in a bank. Indeed, the evidence points to her knowledge of the
    criminal conduct of Neshan and Kenegarajah. At best, she was wilfully blind. In
    any event, I have no doubt all are guilty.

[41]

The
    law regarding insufficient reasons is well established and need not be
    considered in detail. Broadly, a trial judge has a duty to provide reasons that
    explain the result, foster public accountability, and permit effective
    appellate review:
R. v. M. (R.E.)
,
2008 SCC 51, [2008] 3 S.C.R.
    3, at para. 15.  A claim of insufficient reasons is not a free-standing ground
    of appeal and an appeal will only be allowed where the reasons foreclose
    appellate review:
R. v. Vuradin
, 2013 SCC 38, [2013] 2 S.C.R. 639, at
    para. 10.  If an appeal court encounters difficulty in reviewing reasons, it
    may supplement the reasons by considering them in the context of the evidentiary
    record:
R. v. Sheppard
, 2002 SCC 26, [2002] 1 S.C.R. 869, at paras. 52
    and 55.

[42]

Do
    the trial judges reason on this count permit appellant review? In my view,
    they do. The trial judge undertook a very detailed review of the evidence in
    the first part of his analysis. When he considered the various charges, he did
    not repeat the factual findings made earlier. For these charges, he referenced
    the paragraphs that detail the search of Ms. Neeranjans home and noted that
    the items were all visible to her. There was no direct evidence of knowledge or
    control but the trial judge held that the circumstantial evidence was
    sufficient to ground a finding that she had both knowledge and control of the
    proceeds of crime. While it is open to this appellant to challenge that
    analysis, and she does, it cannot be said that the reasons do not permit
    meaningful appellant review. The task for this court is to determine whether
    the trial judges findings were available to him on the evidence. I turn next
    to that issue.

[43]

This
    appellant submits that there was no evidence that she ever entered Mr.
    Kenegarajahs room in which much of the cash and credit cards were kept, and as
    such, knowledge has not been established. Further, she argues that there was no
    evidence of control, as mere indifference or passive acquiesce to the presence
    of stolen goods does not amount to control for the purpose of establishing
    illegal possession.

[44]

In
    submitting that there was an insufficient evidentiary basis for the findings of
    guilt, this appellant is essentially making an unreasonable verdict argument.
    The test for appellate intervention is whether the finding is one that a trier
    of fact, acting judicially, could reasonably have rendered:
R. v. Jackson
,
    2007 SCC 52, [2007] 3 SCR 514, at para. 2.

[45]

In
    my view, the trial judges findings of guilt are well grounded in the evidence
    and were open to him to make. Count 55 relates to the furniture, electronics,
    appliances and household articles at 30 Bissland Drive where she lived with
    her husband Mr. Neshan, and Mr. Kenegarajah. It is clear on the evidence that
    the house was full of furniture, electronics, appliances and household goods
    and that these items were in plain view. In these circumstances, it was an
    available inference to the trial judge that this appellant had custody, access
    and exercised control over the property.

[46]

Count
    57 relates to the currency found in the appellants home at 30 Bissland Drive.
    The police found over $100,000 cash in different currencies and denominations
    in various places in the home, which were either in plain view or accessible to
    Ms. Neeranjan. As such, there was an available inference on the evidence that
    this appellant had possession and control over the currency. Therefore, the
    finding of guilt on this charge was not unreasonable.

[47]

Ms.
    Neeranjan complains that the trial judge did not adequately analyze whether
    there was sufficient evidence to establish that she was wilfully blind. In my
    view, this argument is of no assistance to this appellant given that the trial
    judge made a positive finding that she knew of the criminal conduct of Mr.
    Neshan and Mr. Kenegarajah. This positive finding of knowledge rendered the
    issue of willful blindness irrelevant.

[48]

Finally,
    Ms. Neeranjan submits that the trial judge reversed the burden of proof when he
    stated, at para. 158, there is nothing to suggest that [she] could reasonably
    believe the two men were lawfully employed. However, that statement needs to
    be considered in context. It followed a detailed consideration of the evidence
    against the appellants. That evidence established to the trial judges
    satisfaction that Mr. Neshan and Mr. Kenegarajah worked full-time on the fraud
    scheme and there was nothing to suggest that they were lawfully employed. There
    was no reversal of the onus. This was merely an available inference drawn from
    the evidence.

[49]

I
    would not give effect to this ground of appeal.

(iv)

Mortgage Fraud

[50]

Ms.
    Kanagarajah was charged, among other counts, with fraud over $5,000. The
    circumstances of the offence are as follows. This appellant purchased a home
    with a mortgage obtained from Home Trust Company. The Crown tendered business
    records from Home Trust Company regarding the mortgage application. Those
    records included an unsigned mortgage application and an employment
    confirmation letter from a Richard Frank on the letterhead of World Golden
    Stone Inc., which stated that this appellant worked for that company at a
    salary of $118,000 per annum. The owner of World Golden Stone Inc. testified at
    trial that neither Ms. Kanagarajah nor anyone with the name Richard Frank ever
    worked for the company. The Crown led no
viva voce
evidence from Home
    Trust Company regarding the mortgage approval process.

[51]

Ms.
    Kanagarajah submits that this conviction is unreasonable because the Crown
    failed to prove an essential element of the offence, namely, that the Home
    Trust Company relied upon the false employment confirmation letter submitted as
    part of the mortgage application to its detriment. This appellant also argues
    that the reasons are not sufficient given the lack of evidence of reliance.

[52]

I
    would not give effect to this ground of appeal.  Again, the issue is whether
    the finding is one that a trier of fact, acting judicially, could reasonably
    have rendered.  This appellant has not met this stringent test.

[53]

Was
    it reasonable to conclude that there was detrimental reliance by Home Trust
    Company? In my view, there is a strong available inference on this issue that
    was open to the trial judge. That inference is supported by the following
    facts. It is not disputed that the mortgage funds were advanced. It is also not
    disputed that the letter formed part of the business records of Home Trust
    Company. On the face of the letter there is a handwritten note indicating
    verbally confirmed with Richard Frank on 12/2 @3:30, followed by a signature.
    I note that the letter is a business record and is, therefore, an exception to
    the hearsay rule.

[54]

It
    is difficult to fathom how the inference drawn by the trial judge on these
    facts could be considered unreasonable. Indeed, the inference is almost
    inescapable. The mortgage form indicated that this appellant was employed by
    World Golden Stone Inc. and was earning $118,000 annually. The letter that
    formed part of the application supported that information. The note on the
    letter is clear evidence that the information was confirmed via a telephone
    call. Why would Home Trust Company confirm information if it were not relying
    upon it? Finally, mortgage funds were advanced. The causation inference made by
    the trial judge was well supported by the evidence and was not unreasonable. Further,
    there is no merit to the submission that the reasons are insufficient. This
    ground of appeal should also fail.

(v)

Criminal Organization

[55]

Ms.
    Kanagarajah submits that the trial judge adopted an incorrect legal analysis
    regarding the determination of when a group of persons becomes a criminal
    organization. In finding that a criminal organization existed during the period
    February 1, 2005 to March 3, 2010, the trial judge, at paras. 131-132,
    referenced the definition of a criminal organization described in
R. v.
    Atkins
, 2010 ONCJ 262, at para. 25:

Count 54 alleges the defendants participated in a criminal organization.
Section 467.11(1)
of
    the
Criminal Code
criminalizes the knowing participation or contribution to a criminal
    organizations legal or illicit activities. It does not require a criminal act
    itself and the accused do not need to be a member of the organization. In
R.
    v. Atkins et al.
,
2010 ONCJ 262 (CanLII)
,
    it was held that:

Any reasonable interpretation of the statute would suggest
    that a criminal organization is at minimum, nothing more than: any three
    persons, however organized, who associate for more than offence, to commit
    serious offences for the benefit of at least one person in that group. 
    Maximum flexibility is achieved by the use of the words however organized. There
    are no requirements for (a) formally defined roles; (b) continuity of
    association; or (c) a developed structure. While it is helpful if the group
    obligingly adopts a name associated with some notoriety, or dresses in a
    certain manner with coloured accessories or patches, or establishes a
    territory, the fact is that no particular group structure or organization is actually
    required. Nonetheless, the persons who constitute the group, however
    organized are only associates of a criminal organization to the extent they
    share its criminal objectives.

I agree, on the basis of
Atkins
,
that in this case the Crown must prove that:(a) a criminal
    organization existed during the period February 1, 2005 and March 3, 2010; (b) each
    defendant participated in the group or contributed to its activities; and (c)
    each defendant had knowledge           that the group he or she associated with
    had as one of its main criminal purposes the facilitation of the offences of
    credit card fraud and identity theft and knowledge that his or her involvement
    in this activity would likely result in a direct or indirect benefit to the
    group or any person in the group.

[56]

Ms.
    Kanagarajah argues that
the Supreme Court
    of Canada in
R. v. Venneri,
2012
    SCC 33,

[2012] 2 S.C.R.
    211

effectively

overruled
Atkins
, when it concluded, at para. 29, that a
    criminal organization must have some measure of continuity of association and a
    developed structure: by insisting that criminal groups be organized,
    Parliament has made plain that some form of structure and degree of continuity
    are required to engage the organized crime provisions that are part of the
    exceptional regime it has established under the
Code
.

[57]

Ms.
    Kanagarajah further submits that the trial judge compounded this legal error by
    failing to recognize or consider the effect of evidence that cast doubt on
    whether a criminal organization existed and whether she knowingly participated
    in that organization.  She submits that there was no evidence of her being part
    of an ongoing course of conduct, given that she was acquitted of global
    conspiracy and money laundering charges. Further, there was the possibility, not
    considered by the trial judge, that she was only brought into the group for the
    single mortgage fraud offence. In addition, she argues that there was no evidence
    of whether she knew she was participating in a criminal organization or intended
    to commit the mortgage fraud for the benefit of the group.

[58]

Ms.
    Neeranjan also appeals her criminal organization conviction. She submits that
    the trial judges reasons on this count were insufficient for meaningful
    appellant review. Further, she argues the trial judge conducted no analysis of
    whether she advanced the interests of the criminal organization, knowing that
    the group had the characteristics of a criminal organization or for its
    benefit.

[59]

Finally,
    Mr. Kenegarajah submits that Ms. Kanagarajahs and Ms. Neeranjans appeals of
    their criminal organization convictions should be allowed and, if they are, his
    conviction on that charge should be set aside because the statutory definition
    of criminal organization, being composed of three or more persons, has not been
    satisfied.

[60]

I
    would not give effect to any of these grounds of appeal.

[61]

First,
    with respect to the alleged legal error, it is true that the trial judge
    referenced a case that is inconsistent with
Venneri
to the extent that
    it suggests structure and continuity are not necessary in a criminal
    organization. However, in his reasons, at para. 170, the trial judge found both
    structure and continuity:

Different considerations apply with respect to the criminal
    organization count. Having regard to all my conclusions, I have no doubt that a
    criminal organization existed between 2005 and 2010. Neshan and Kenegarajah were
    the leaders of this group. Neshans wife, Neeranjan, and Kenegarajahs sister,
    Kanagarajah, participated in the group and contributed to its activities, as
    set out above. All four individuals knew the group had as its criminal purpose
    the facilitation of credit card fraud and identity theft and each one benefited
    to a greater or lesser extent. This meets the criteria provided for in s. 467.1
    of the
Code
. For reasons already stated, I am not confident that these
    observations apply to Nesarajah. Accordingly all but Nesarajah are found guilty
    of this offence.

[62]

In
    his analysis, therefore, the trial judge followed the dictates of
Venneri
and made the necessary factual findings regarding the nature of the enterprise
    to ground a finding of participation in a criminal organization.

[63]

Despite
    the submissions of Ms. Kanagarajah and Ms. Neeranjan, there was ample evidence
    that demonstrated they were members of a criminal organization and knowingly
    participated in its activities to facilitate or commit indictable offences.  I
    note that these appellants do not contest the evidence presented by the Crown
    at trial establishing an enterprise in common between Mr. Neshan and Mr.
    Kenegarajah to defraud individuals and financial institutions.

[64]

The
    properties purchased in Ontario, as part of the fraudulent scheme, include
    311-11753 Sheppard Avenue East, Scarborough; 30 Bissland Drive, Ajax; 47 Portelli
    Crescent, Ajax; 87 Portelli Crescent, Ajax; and 1640 Pennel Drive, Oshawa. These
    transactions permitted the organization to launder the proceeds of crime and
    the properties were used as drop locations for mail from financial institutions
    that were victimized in the fraud. The Pennel Drive property was in the name of
    Ms. Kanagarajah. She also leased the Land Rover used by Mr. Neshan and Mr.
    Kenegarajah to commit the bank and credit card frauds. A police search of the
    Land Rover revealed evidence of the fraud, including two bust out ledgers used
    to keep track of the numerous false identities. A search of 311-11753 Sheppard
    Avenue East, Ms. Kanagarajahs residence, revealed approximately 13 mobile
    phones. Those phones were used to make over a thousand telephone calls to the
    financial institutions that were the victims of the fraud. It was open to the
    trial judge, based on this evidence, to find that Ms. Kanagarajah was knowingly
    complicit in the criminal organizations activities.

[65]

Similarly,
    title to the Portelli Crescent properties were in Ms. Neeranjans name.  The
    trial judge expressly found that the properties were purchased as a means to
    launder crime proceeds. He also concluded that this appellants ownership of a
    gas station was part of the same fraudulent scheme to launder money. There was,
    therefore, an evidentiary basis for the trial judges finding that Ms.
    Neeranjan knowingly participated in the criminal organization. His reasons in
    this regard are sufficient, as they do not foreclose appellate review.

[66]

It
    follows that Mr. Kenegarajahs submission that his conviction on this charge
    should be set aside because the statutory definition of criminal organization
    has not been satisfied must fail.

Disposition

[67]

I
    would dismiss all of the appeals, save for that part of Mr. Kenegarajahs
    appeal wherein he submits that he was convicted of counts with which he was not
    charged. I would allow that part of the appeal and quash Mr. Kenegarajahs convictions
    on counts 53, 56, 58, and 59. In addition, for Mr. Kenegarajah and Mr. Neshan,
    I would quash the convictions on count 2 and enter acquittals in their place,
    and I would enter convictions on count 1 for both of these appellants.

Released: D.W. February 8, 2018

C.W.
    Hourigan J.A.

I
    agree. David Watt J.A.

I
    agree. B.W. Miller J.A.


