Members of Toronto's Jewish community have lost more than $27 million in a Ponzi scheme perpetrated by one of its own members, Canada's National Post newspaper reported on Tuesday.
The alleged fraud involving 76 high-profile investors came to light after a small printing plant in the Richmond Hill section went bankrupt.
The scheme was allegedly run by Tzvi Erez, 42, a prominent community member who owned the small print shop and claimed he was brokering large jobs for blue-chip clients, according to two of his alleged victims who spoke to the National Post.
The victims told the newspaper that Erez approached them through intermediaries for cash advances on orders and allegedly promised to return the original investment plus interest fees of 30% once he delivered the printed orders to his clients.
The report, however, quotes a court-appointed official as saying there were no large orders, and that between Jan. 25, 2007 and Feb. 17, 2009, $38.9-million went through eight different bank accounts in Canada that belonged to Erez or one of his companies.
Erez is a master pianist who launched his own label in memory of his brother, killed in 2000 during a heist at a jewelry store where he worked, the National Post reported.
Erez moved to Canada from Israel as a teenager and studied at the Community Hebrew Academy. He is married with two children, and, until recently, lived in a home worth more than $1.3-million in Toronto. The home was seized by authorities last summer.
According to the National Post, Erez's stepfather, Leo Erez, was approached by creditors - and a local rabbi - in a bid to settle the dispute before it hit the courts, according to a lawyer who handles several claimants.
A bankruptcy order has been issued against Erez personally and all of his companies.
