Toronto artist says he lost $2M in stolen paintings, forged mortgage to alleged fraudster killed last week
Lawyer says killing of Arash Missaghi was ‘the almost inevitable result of decades of institutional inaction’
Alijan Alijanpour met Arash Missaghi when Missaghi commissioned a Persian miniature painting of his late mother for $50,000 a decade ago.
Missaghi paid for that commission and a few more — earning the internationally renowned Iranian Canadian artist's trust.
But since then, Alijanpour, 68, alleges Missaghi stole his life's work: 38 paintings, worth more than a million dollars combined and which took him more than 20 years to complete, according to his lawsuit.
He also says Missaghi left him drowning in debt from a $1.2-million mortgage that he alleges Missaghi orchestrated and had forged in his name.
"I lost so much," Alijanpour told CBC Toronto through a translator.
"I have never seen such a person like him in my life."
Missaghi and Samira Yousefi were shot and killed at Missaghi's Toronto office last week by a man named Alan Kats, who then killed himself. Kats's widow, Alisa Pogorelovsky, said her husband "could not handle losing our life savings, and that is what led to this tragic event."
Pogorelovsky shared a note Kats left, naming the two he later killed and others, that said, "Stop these criminals from destroying people's lives."
Earlier this year, the couple sued Missaghi, Yousefi and others after losing $1.28 million in an alleged mortgage fraud.
CBC Toronto reviewed hundreds of pages of court records and found two dozen lawsuits against Missaghi and others claiming more than $90 million over 20 years, as well as police reports, criminal fraud charges and that two of Missaghi's lawyers had lost their licences. Despite all this, Missaghi was never convicted, sanctioned or found liable of any of his alleged serial frauds before his death.
Peter Smiley, a Toronto civil lawyer who started working on cases against Missaghi in 2018, said last week's tragedy "was the almost-inevitable result of decades of institutional inaction."
"These are criminal matters which, by virtue of the inaction of the police and the inaction of the Crown, have been forced into the civil justice system," he said.
Missaghi has remained an undischarged bankrupt since declaring bankruptcy in 2000. On paper, Smiley said this means he has no assets in his name against which to enforce a civil judgment.
But in reality, the lawyer alleges, Missaghi just concealed his "considerable assets" obtained from fraud using shell companies and straw purchases. In a recent order issued in Pogorelovsky's civil case, Ontario Superior Court Justice Lee Akazaki wrote that Missaghi and his wife "control or have controlled upwards of $50 million in North American assets."
"If you were a victim of a Missaghi fraud, you were put in the unenviable position of [pursuing] this multi-millionaire, undischarged-bankrupt fraudster through the court system who was defending himself with the best lawyers in Toronto," said Smiley.
"Which he is paying for with the money that he stole from you."
Fraud prosecution 'no longer a public interest'
In 2018, Toronto police charged Missaghi with fraud over $5,000 and forging documents, following a five-year investigation into an alleged $17-million complex mortgage fraud scheme dubbed Project Bridle Path. In July 2021, the Crown withdrew the charges against him.
The Ministry of the Attorney General told CBC Toronto that the Crown had determined there was "no longer a public interest in proceeding" after examining the case.
In 2019, Alijanpour reported to Toronto police that Missaghi had stolen $1.2 million worth of his paintings. Missaghi had offered to help move the paintings to the artist's new gallery, but, Alijanpour alleged in his statement of claim, Missaghi kept them instead. The lawsuit is still before the courts in Toronto.
Artist says police report went nowhere
In a February 2021 email reviewed by CBC, a detective told Alijanpour he was going to charge Missaghi for possession of property obtained by crime and extortion.
That never happened, as far as Alijanpour knows, and the case went nowhere after that detective left the police service in June 2022.
CBC asked Toronto police for details about that investigation, as well as about a police report about Missaghi that Pogorelovsky says she and her late husband filed in January 2024.
In a statement, spokesperson Stephanie Sayer said, "We cannot provide information about the deceased's past criminal history, beyond what we have released publicly."
Through her lawyer, Pogorelovsky told CBC she and Kats had immediately reported the alleged mortgage fraud to police after uncovering what had happened at the beginning of this year.
"Unfortunately, almost half a year later, other than an email confirming receipt of our information and that a detective was assigned, we received nothing else. No follow-up whatsoever," said Pogorelovsky in a statement.
Missaghi was also charged with two counts of fraud as part of an earlier joint police service investigation called Project Tic Toc in May 2006, which included mortgage fraud. He was not convicted in that case.
"If there is no law, no one will be secure and safe," said Alijanpour.
"Who is responsible? Is it a judge? Is it the law? Is it court? Is it the police?"
Several lawyers disciplined
While Missaghi was never convicted of fraud, several lawyers involved with his alleged mortgage fraud schemes have lost their licences or been suspended by the Law Society of Ontario (LSO).
A decision to revoke Golnaz Vakili's licence in 2015 states she participated in "a massive fraud spree and multiple dishonest acts involving 13 different properties" between 2011 and 2013. The LSO decision said her clients lost just under $14 million as a result.
Those alleged frauds eventually led to the criminal charges from Toronto police in Project Bridle Path.
Jonathane Ricci, another lawyer connected to Missaghi, had his licence suspended in 2016 for failing to produce requested documents in a law society investigation into a real estate transaction. His licence remains suspended.
And in 2019, a third lawyer, Rasik Behari Mehta, surrendered his licence and admitted to participating in six fraudulent real estate transactions involving Missaghi.
"Missaghi and his associates have been involved in a long pattern of fraudulent real estate transactions, often involving manipulation of power of sale processes to defeat subordinate mortgagees," reads the 2019 tribunal decision.
"Over the course of his relationship with Missaghi the Lawyer received subtle and, increasingly, not so subtle threats of harm if he failed to do as Missaghi demanded."
Two complaints about same lawyer
Both Alijanpour and Pogorelovsky filed LSO complaints against the lawyers involved with the alleged mortgage frauds in 2021 and 2024, respectively.
Both filed complaints against the same lawyer, who remains in good standing with the law society.
"Mr. Missaghi could not have carried out the frauds that he did without the active assistance and co-operation of various regulated professionals, in particular lawyers and mortgage brokers," said Smiley.
As a result, he argues, the LSO and Financial Services Regulatory Authority of Ontario (FSRA) also need to look into whether they could have done more to stop Missaghi.
In a statement, an LSO spokesperson said its investigations are confidential "until or unless they result in public regulatory action."
"Given the number of Law Society prosecutions of lawyers involved with Mr. Missaghi, and his sophisticated frauds, the Law Society does not agree that more could have been done to stop the fraudulent conduct of Mr. Missaghi, who was not a licensee," said spokesperson Jennifer Wing.
FSRA confirmed Missaghi was never a licensed mortgage broker or mortgage agent. In a statement, the regulator said its predecessor issued a warning in 2020 to consumers that Missaghi was not licensed to conduct mortgage business in Ontario.
It remains unclear what will happen with the many unresolved lawsuits against Missaghi.
In the meantime, Alijanpour has been painting more generic work and selling it for less.
"How much artwork do I have to sell to be able to pay my lawyers?" he said.
"What should I do? What can I do?"
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With files from the CBC Reference Library