Former Winnipeg property manager, lawyer avoids disbarment after misusing funds

A former Winnipeg real estate manager and attorney has been spared a ban from practicing law but will never be allowed to practice law again after admitting to misappropriated more than $360,000 in trust funds.

Instead, Jeff Rabb will be given the opportunity to resign as a member of the Law Society of Manitoba after pleading guilty to wrongful conduct as an attorney, so long as he writes to the regulator pledging never to seek bar membership again.

He has 30 days to do so from the time his attorney receives it the reasons for the decision of the three-person panel, which were published on January 23. If he fails to do so within this period, or within a longer period agreed by the Bar Association, his license to practice law will be revoked.

Rabb was also ordered to pay the bar association $4,525 in costs. A second charge of professional misconduct against him was dropped.

Rabb’s attorney did not respond to a request for comment Tuesday.

2019 was Rabb sentenced to one year house arrest and was ordered to pay $100,000 after using the investors’ money to fund projects including renovations to his home and a hockey rink in his backyard.

Supervisory authority wanted professional ban

While Rabb did not present evidence at the bar association hearing in December 2022, the 65-year-old read out a statement apologizing to those close to him for the harm he had caused, the regulator’s decision said .

“He took ‘full responsibility’ for his actions, offered ‘no excuses’ and only asked that he be spared the ‘final humiliation’ of being banned from his profession,” the decision said.

“The request was clearly heartfelt and undoubtedly sincere.”

Rabb was indicted by the Bar Association in 2020 on misappropriation of funds, which the ruling said spanned from 2009 to 2015.

Although he was not actively practicing law at the time of the misconduct, the Bar Association argued that this was irrelevant and called for his ban from practicing law.

The decision to give him the chance to resign instead was taken by the Bar Association’s Disciplinary Committee, which operates independently of the regulator and includes a public representative.

Leah Kosokowsky, chief executive officer of the Law Society of Manitoba, said in an emailed statement that while the regulator advocates a different outcome, it respects the panel’s decision.

“Not too sophisticated” methods

The Law Society Panel’s decision said the manner in which Rabb misused the funds was unlikely to go unnoticed for long, in part because it required the help or acceptance of many other people.

“The panel notes that these methods of embezzlement were not overly sophisticated,” it said.

“Indeed, it is quite surprising that Mr. Rabb could continue his pattern of deception for as long as he did.”

In 2019, in separate filings before the Manitoba Securities Commission and a Manitoba Provincial Court judge, Rabb admitted to misappropriating funds.

The Securities Commission revoked Rabb’s license and then banned him for life a settlement agreement was signed He said he defrauded investors at his company, Winpark Dorchester Properties — later named Alderman Capital Corporation — out of more than $421,000.

These methods of embezzlement were not overly sophisticated… It is quite surprising that Mr. Rabb was able to continue his pattern of deception as long as he did.– Law Society of Manitoba decision reasons

That agreement said Rabb used money from escrow accounts belonging to approximately 50 properties managed by Winpark to pay for work on his home, his girlfriend’s home and an employee’s cottage.

To cover this up, the bills would then be booked as work on the Winpark properties and split between different bills.

Rabb or another Winpark director also asked contractors to create fake invoices, remove addresses from receipts and change the locations of construction sites on documentation, the 2019 agreement said.

Rabb’s submission to the bar asked the regulator to allow him to resign rather than disfellowship him – either way he would be barred from practicing law and the latter option carries more stigma.

Mitigating factors argued

Mitigating factors cited were Rabb’s lack of a criminal record, his cooperation with the disciplinary process and remorse for his actions, and the fact that he returned all misused money and associated fines.

Rabb’s submission also said that at the time of the misconduct he was “prone to misconduct” because he was under extreme stress related to depression, anxiety and concerns about family problems and his loss of status as a successful businessman.

The bar found that given the circumstances of the case, Rabb had the option to resign, “within the realm of reasonable outcome.”

“The bottom line is that Mr. Rabb will no longer be able to practice law in Manitoba or anywhere else,” the decision said, adding the outcome will uphold public confidence in the legal profession and the duty of the Bar Association to protect the public interest.