1st complaint about Mississauga, Ont., lawyer was in 2004 - 6 years before he was disbarred
The lengthy amount of time it took the Law Society of Upper Canada to quietly investigate and then disbar a crooked lawyer may have cost his clients millions of dollars, critics charge.
Now-disgraced Mississauga, Ont., lawyer Richard Chojnacki went to prison after pleading guilty to fraud in 2012.
But CBC News has learned the law society was first alerted to him in 2004, when a toy maker complained he had siphoned money from an escrow account.
Maryann Cambruzzi, left, whose family saw nearly $3 million disappear, gazes at a screen showing a photo of now-disbarred and convicted lawyer Richard Chojnacki. (CBC)
The regulatory body for Ontario lawyers began investigating and found other cases where Chojnacki mishandled clients' money. But it never called police, didn't post the information on its website until 2008, and didn't disbar the lawyer until 2010.
It was ultimately determined that in the toy company case alone, Chojnacki had mishandled more than $3 million, embezzling at least $500,000 for himself.
While the law society's dealings with Chojnacki dragged on, he went on to fleece five further clients for close to $5 million.
"I would call them victims of this slow-moving process," said seasoned criminal prosecutor Steve Sherriff, who spent close to a decade as the law society's senior counsel for discipline.
"In my time, we'd have done a case like this in far less than a year from start to finish," he added. "That 6½ years of delay hurt…. Along the way there, citizens, more clients lost 5-million dollars.
'We were lambs for slaughter'
One of those clients was Maryann Cambruzzi, who hired Chojnacki in 2007. He stole almost $3 million from her family. Speaking about the law society, she said, "I felt that they hung us out to dry. I felt like we were lambs for slaughter."
Current Law Society of Upper Canada head Thomas Conway said the organization moved quickly when it received the first complaint in 2004; it placed restrictions on the money Chojnacki held in trust for clients.
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"Based on our assessment of the evidence that we had at the time, it was our belief that freezing his trust account and having his trust account supervised was a sufficient response to the very serious allegations that had been made," he said.
Sherriff said the measures were weak. "It sounds good. But it's easily defeated by a serious criminal."
And so it was: Chojnacki found ways around the restrictions and secretly continued stealing from clients.
Disbarred lawyer Richard Chojnacki, left, won the trust of the late Leonard D'Atri before he died, and eventually stole almost $3 million from his family. (CBC)
Conway also said the law society didn't have enough reason to suspend Chojnacki then.
"At the time, we also conducted an investigation into the rest of his practice. And we didn't have evidence at the time that there were any other instances or any other complaints from clients," he said.
But CBC News has learned the society did uncover other cases it later determined showed a pattern. In 2003, Chojnacki had used almost $500,000 held in trust for two separate clients to pay his own bills. The society learned of one of those incidents by 2005 and the second, by 2007.
The law society also didn't contact police. Conway said when they got the first complaint, they couldn't because "it is the client's right to have information protected."
But Sherriff said the society can call police if it believes other clients may be at risk. So when the organization learned of more cases, he said, it should have picked up the phone. "And who better to notify than the criminal authorities, who can deter lawyers engaged in dishonesty by jail sentences," he added.
2 more complaints in 2009
Conway said the law society did take more severe measures when it received two more complaints in 2009. It got Chojnacki to agree to stop practising until the outcome of his hearing.
But it was too late for Cambruzzi. Two years earlier, she had hired the lawyer to oversee the sale of her father's storage company.
Under direction from the family, Chojnacki kept almost $3 million from the sale in a trust account for the children. Then, in 2009, Cambruzzi made the devastating discovery that the money was gone.
Law Society of Upper Canada head Thomas Conway said his organization's investigators didn't have enough evidence initially to take drastic measures against Chojnacki. (CBC)
"I was physically sick, mentally sick, couldn't function, lost a ton of weight, lost a ton of hair, had to be hospitalized several times," she said.
That same year, Cambruzzi learned Chojnacki was facing disciplinary hearings. The law society had posted the information on its website in 2008, one year after Cambruzzi had hired him and four years after the society started investigating him.
Cambruzzi was floored the society didn't take earlier steps to notify the public or stop him from practising. "The lawyers are protecting the lawyers," she said. "I don't feel that my best interest was addressed at all."
Cambruzzi, not the law society, then alerted police. Officers launched an investigation and found more victims. Sherriff was the prosecutor in the criminal case.
Two years after being disbarred, Chojnacki was sentenced to four years in prison. He served about a year before being released on day parole last November. During his parole hearing, he said he stole from clients to support an expensive addiction to painkillers.
Law society head Conway acknowledged that "we sometimes don't always get it right." He added that the society now posts hearing notices more quickly and has greater power to suspend a lawyer.
Some of Chojnacki's victims received compensation from the law society. It can award dishonest lawyers' victims up to $150,000.
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