FSRA clamps down on former industry figure for brokering 15 deals tied to an alleged fraud scheme
Ontario's financial services regulator has imposed $275,000 in administrative penalties against a former mortgage agent who conducted transactions outside her brokerage and facilitated a scheme orchestrated by a fugitive fraud suspect.
The Financial Services Regulatory Authority of Ontario (FSRA) issued the order against Lin Liang on May 11, following a settlement reached on April 25.
Liang, who held licence number M19000939 from April 2019 until her brokerage terminated her in January 2022, admitted to a series of regulatory breaches under the Mortgage Brokerages, Lenders and Administrators Act, 2006 (MBLAA).
Under the terms of the settlement, 31 administrative penalties in the total amount of $275,000 were imposed, a reduction from the $440,000 FSRA initially proposed in a January 2024 Notice of Proposal.
Read more: Mortgage fraud: The emerging warning signs brokers need to spot
The Fu fraud scheme
The case centres on Liang's involvement in 15 mortgage transactions conducted between May and November 2021, all outside her authorising brokerage.
Nine of those transactions were later determined to be fraudulent, tied to Yuansen (Eric) Fu, who is wanted by Toronto police in connection with an alleged scheme that generated over $10 million in fraudulent mortgage proceeds. Fu has since fled Canada.
Fu's alleged operation used imposters posing as homeowners, armed with forged and altered documents, to obtain mortgages from private lenders and retain the proceeds, leaving properties encumbered and lenders exposed.
According to police, Fu used fake identification and set up fictitious lenders, borrowers, and companies to obtain private mortgages while using fake identities of real people to place fraudulent mortgages on victims' homes without their knowledge.
Four men have been arrested in Montreal and Quebec City following a major fraud investigation, with authorities alleging the group extracted more than $4.5 million from financially distressed homeowners across Quebec.https://t.co/UhoGqybq9s
— Canadian Mortgage Professional Magazine (@CMPmagazine) June 1, 2026
The FSRA settlement found that while Liang did not have actual knowledge of the fraud, she ought to have known she was being used to facilitate it.
Warning signs included a single common referral source (Fu), instructions not to contact borrowers directly, and a request in one transaction to ask a lender not to deposit a cheque due to insufficient funds.
Liang collected fees through a corporation she owned and controlled, 10350575 Canada Corp. Those fees were paid from the proceeds of the mortgage transactions.
FSRA has confirmed it may consider Liang's admitted conduct as an aggravating factor should she, or any related entity, apply for a licence in the future.
A pattern of industry-wide enforcement
The Liang penalty arrives as FSRA intensifies scrutiny across Ontario's mortgage sector. In its first-ever Enforcement Annual Report, FSRA revealed it focused most of its 2025 investigations on mortgages, to the tune of $860,000 in penalties, a 50% increase over the prior year.
Across all regulated sectors, FSRA initiated 100 enforcement actions in the 2024–25 fiscal year, up from 65 the previous year, imposing administrative monetary penalties totalling $1.2 million.
Read more: FSRA moves against trio over alleged fake gift letters, unlicensed brokering
Liang is not the only agent connected to the Fu scheme to face regulatory consequences. FSRA also took action against Yujun (Janet) Shi, a former mortgage agent who faced penalties for brokering fraudulent loans connected to the same network.
The fraudulent transactions resulted in over $8.5 million in mortgage proceeds, with at least one lender suffering direct losses of $1.1 million due to a transaction not covered by title insurance.
Meanwhile, a survey by Pollara Strategic Insights for Mortgage Professionals Canada and the Mortgage and Title Insurance Industry Association of Canada found that 78% of respondents agreed mortgage fraud creates an unfair playing field, while 64% said it inflates housing prices.
Make sure to get all the latest news to your inbox on Canada’s mortgage and housing markets by signing up for our free daily newsletter here.
