One email asked for the money back. The court had other plans
Justice Parghi found a registered money service business in contempt on September 23, 2026, after it asked for frozen funds to be sent to itself.
The ruling, a decision of the Ontario Superior Court of Justice, began with an order in November 2025. That month, two companies won an urgent order forcing the firm to hand over records. The companies allege they lost approximately USD $1,122,833.28 in a complex international fraud, with the money routed through the firm to an entity the court described as a pretender bank.
That fraud claim was not the question this time. The court asked whether the firm followed four court orders. It had not.
The firm has 30 days to produce the missing records or face a penalty hearing. Two individual respondents were not found in contempt.
One email, the wrong address
In February 2026, the court ordered the firm to arrange for USD $371,850.83 to be paid into court within five business days, wherever the money sat. An earlier freeze order barred the firm from seeking to move or release those funds.
The firm's chief compliance officer contacted the third-party payment firm holding the money on March 23, 2026, about six weeks past the deadline. Her email asked that the funds be released to her firm. It did not mention the court order or copy the other side's lawyers, as required.
Justice Parghi found the request was "effectively the opposite of what the order required." She also found it broke the freeze order.
The paperwork that never showed up
The orders called for bank records and emails in their original digital form, plus data showing exactly where the money travelled. The firm sent PDFs stripped of that underlying data. When the payment firm offered to pull the full transfer trail, the money service business never asked it to.
The firm also withheld its reports to FINTRAC, Canada's anti-money laundering watchdog. It argued federal law barred disclosure, an argument the court had rejected twice before. At other points, it said the reports were still being prepared or that the emails could not be found. The judge found its positions unfounded.
Then came the WhatsApp messages. The firm said they were due diligence chats with the pretender bank. The court found the record strongly suggests the number belonged to an Estonian cryptocurrency company owned and controlled by an individual respondent. It concluded the firm tried to pass that company off as the bank.
A late bias bid goes nowhere
Twelve days before the July 7, 2026 hearing, the firm and the individual respondents asked the judge to step aside, arguing her earlier critical findings showed bias. She refused to hear the request because it came too late without a good reason, and said she would have rejected it anyway. Tough past rulings, she noted, are not bias.
At the hearing, the firm's lawyer accused the companies and their counsel of misleading the court about where the money was. The judge rejected that claim as entirely unfounded. In April, she had already ordered the firm to pay $185,000 in costs at a higher-than-usual rate.
To clear the contempt, the firm must give the payment firm's special administrator a binding instruction to send the funds to the court, with the other side copied. On that March email, the judge was direct: "Certainly, one would expect a compliance officer of a registered money service business to understand this distinction."
