Frances Mary Chan Legal Case

The fraud

Frances Mary Chan's offending was far more than a simple case of fraud. The evidence presented to the court showed a pattern of gaining people's trust, convincing them she was acting in their best interests, and then using their money, homes and property titles to solve her own growing financial problems. By the time the matter reached the courts, several families had lost substantial amounts of money, some had lost their homes or financial security, and countless legal documents had been created to disguise what had really happened.

 

Val & Kenneth Waldron

One of the main victims was Val Waldron and her husband, Kenneth. The couple had first met Frances Chan in 1967 after she arrived in Perth from Singapore as a student. Through the Australian Asian Association, they helped support overseas students studying in Western Australia and developed a friendship with her over many years. Chan later qualified as a nurse before becoming a real estate agent, and over time the Waldrons came to trust her as both a family friend and someone who could assist with their property matters.

 

Around Christmas 1989, Chan approached the elderly couple claiming she desperately needed money to save her struggling real estate business. She told them she could not borrow from anyone else and asked for $15,000. Although the Waldrons could not initially afford the full amount, they loaned her $5,000 after discussing it together. Chan assured them it would be repaid within five or six weeks. They later advanced her a further $10,000. The first loan took around a year to repay, while the second remained outstanding years later. Chan later claimed these payments had either been gifts or money intended for property investments on the Waldrons' behalf but Mrs Waldron firmly denied this and the jury rejected Chan's version of events.

 

The offending escalated when the Waldrons decided to sell their South Yunderup holiday home and move into a retirement village at Bibra Lake. Chan offered to manage the sale, telling the couple they were getting older and that she would take away all the stress and worry associated with selling the property. She also assisted them with arrangements relating to their Bateman home, which they had previously gifted to the Moral Re-Armament movement while retaining a life tenancy. The proceeds from selling both properties were intended to pay for their retirement unit.

 

The South Yunderup property eventually sold for $72,000, although the transaction was far from straightforward. Unknown to the Waldrons, Chan entered into a separate arrangement with the purchaser giving herself a half interest in the property, while falsely recording payments that had never been made. Mrs Waldron believed she had simply received the best price available, unaware Chan had acquired an interest in the property herself.

 

After settlement, Mrs Waldron endorsed the $72,000 cheque over to Chan because she had been told the money would be safely held in a trust account until it was needed to complete the purchase of the retirement unit. Instead, the money was deposited directly into Chan's personal bank account, which was already overdrawn. Almost immediately, large amounts were withdrawn or transferred into her business accounts and other personal interests, including a restaurant in which she held a financial interest. Instead of holding the money in trust as Mrs Waldron believed, Chan began spending it almost immediately.

 

As settlement of the retirement unit approached, the Waldrons continued placing their trust in Chan. Mrs Waldron gave her another $22,000, believing it would also be held safely until settlement. Shortly afterwards, Mr Waldron handed over a further $32,150 from the sale of their Bateman property for exactly the same purpose. Once again, the money was deposited into Chan's own accounts, which were heavily overdrawn. The funds quickly disappeared into her own financial affairs rather than being preserved for the Waldrons' retirement home.

 

As Chan's financial situation worsened, the Waldrons were asked to sign increasingly complicated legal documents, like deeds, declarations of trust and authorities which they believed were simply required to finalise the purchase of their retirement unit. Mrs Waldron later told the court she did not understand what many of the documents meant and signed them because Chan told her they were necessary. Some documents even reversed ownership arrangements by declaring that the Waldrons held property on trust for Chan, despite them being the true purchasers. These documents had largely been prepared by Chan's solicitor, Seng Fai Chan, who was also her husband and the principal of Paternoster & Chan.

 

Because the money entrusted to Chan had already been spent, settlement of the Bibra Lake unit repeatedly failed. Deadlines passed, interest penalties accumulated and the elderly couple were forced to pay rent while waiting to move into a home they believed had already been paid for. Fresh loans had to be arranged under increasingly complex agreements simply to complete the purchase. Evidence before the court showed that part of the money used to complete the purchase of the retirement unit had actually come from another victim, meaning Chan was using one victim's money to resolve problems she had created for another.

 

Throughout the trial, Chan maintained that the Waldrons had willingly given her the money as gifts because of their close relationship, claiming they wanted her to become successful in business and care for them in their old age. She even suggested Mr Waldron had personally handed her one cheque "with a hug and a kiss". Mrs Waldron strongly rejected those claims, insisting every payment had been made solely to purchase their retirement unit. The jury accepted Mrs Waldron's evidence and rejected Chan's version entirely.

 

The Waldrons were not the only people who had placed their trust in Chan. As their money disappeared, Chan began raising larger sums by using other people's homes as security for bank loans. To do this, she needed to convince lenders that she effectively owned properties which actually belonged to other people. The court heard that she created a complicated network of trust arrangements, declarations and legal documents to give that impression, while continuing to assure the owners that she was simply borrowing their property titles temporarily to help resolve financial difficulties.

 

Pietro & Glenis Corena

Among those drawn into the scheme were Pietro and Glenis Corena. Chan approached them while discussing financial problems involving their daughter and son-in-law's furniture business, Vista Furniture. She presented herself as someone trying to rescue the struggling business and explained that she needed to borrow the titles to the Corenas' unencumbered properties so she could obtain finance. She assured them the arrangement would only be temporary, claiming she expected money to arrive from Singapore within a few months and that everything would then be returned to normal. Believing they were helping both their family and Chan, the Corenas agreed to hand over the certificates of title to two of their properties.

 

What followed was very different to what the Corenas believed they had agreed to. They were presented with complicated legal documents, declarations of trust and acknowledgements stating that they were merely holding their own homes in trust for Chan. Mr Corena later told the court he did not understand the documents, had never intended to transfer ownership of his properties and believed he was simply allowing Chan to use the titles as temporary security. He recalled being hurried through the paperwork, told to "sign here, sign there" and, in some cases, signing documents without having an opportunity to properly read them. The court accepted that he had no understanding of the true nature of the transactions.

 

R & I Trustees

To obtain a substantial loan from R & I Trustees, Chan submitted an application claiming ownership or beneficial ownership of numerous properties, including homes that actually belonged to the Corenas, Mrs Tailor and others. The application also suggested these properties were generating rental income when they were not. Because some properties were registered in other people's names, explanations were provided claiming they were merely holding the properties on trust for Chan and that ownership would shortly be transferred back into her name. Those explanations were later shown to be false.

 

R & I Trustees initially considered the loan because the supporting information appeared plausible and the accompanying legal documentation appeared to confirm Chan's claims. However, the company's solicitors required formal declarations from the property owners confirming they supposedly held the properties solely on Chan's behalf. The Corenas and Mrs Tailor signed these documents without understanding their true significance and without obtaining independent legal advice, despite being warned they should do so. Instead, the documents were explained and witnessed by Chan's own solicitor, Seng Fai Chan, despite his obvious conflict of interest. The Court of Appeal later described his position as "intolerable", observing that he was acting for Chan while supposedly providing advice to the very people whose homes were being placed at risk.

 

Evidence from R & I Trustees showed the company would have viewed the entire application very differently had it known the truth. Senior lending manager Frank Kamp told the court that the loan had been approved on the understanding that Chan genuinely owned or beneficially controlled the properties offered as security. Had the lender known that many of the titles had simply been borrowed from trusting friends and acquaintances, or that secret agreements existed contradicting the declarations presented to the bank, the application would have been fundamentally undermined. The court accepted that these false representations were central to obtaining the loan.

 

As Chan's financial position deteriorated, she defaulted on the loan and R & I Trustees eventually forced the sale of Mrs Tailor's Mandurah property, which had been used as security. Around $54,000 from the proceeds was paid directly to the lender. Mrs Tailor repeatedly asked when she would receive the balance and was falsely told settlement had not yet taken place or that the money was being safely held on her behalf until she needed it. Chan even encouraged her to begin looking for another home, suggesting units she intended to purchase in Rivervale, despite the proceeds no longer being available. Mrs Tailor later told the court she had never intended to invest the money and had always planned to use it to buy another home closer to Perth. Even Chan accepted that at least $20,000 remained owing to Mrs Tailor, although the court considered the true amount was likely to have been considerably higher.

 

Shirley Tailor

Shirley Tailor was another long-time acquaintance who placed her trust in Chan. After asking whether Mrs Tailor's Mandurah home was mortgage-free, Chan requested the certificate of title, explaining she only needed it temporarily to obtain finance. She promised to pay Mrs Tailor a small weekly amount while the title was being used and assured her the property would remain safe. Trusting those assurances, Mrs Tailor handed over the title without any formal written agreement.

 

Mrs Tailor later decided to sell her Mandurah home so she could move closer to her elderly mother in Perth and again entrusted Chan with the sale. Unknown to Mrs Tailor, the property was ultimately sold as part of arrangements required by R & I Trustees after Chan defaulted on the loan secured against it. Around $54,000 from the sale proceeds was paid directly to the lender to reduce the outstanding debt, while Chan was permitted to retain some of the remaining money after claiming she needed it to meet other financial commitments.

 

Mrs Tailor repeatedly asked when she would receive the balance of the sale proceeds and was told settlement had not yet taken place or that the money was being safely held on her behalf until she needed it. Chan also wrote letters claiming the funds remained available for Mrs Tailor's benefit and even encouraged her to begin looking for another home, suggesting units she intended to purchase in Rivervale. The court found those representations were untrue. Much of the sale proceeds had already been used, and Mrs Tailor never received the money she had intended to use to purchase another home closer to her family.

 

The court also heard evidence of a document supposedly authorising the sale proceeds to be transferred to Chan, although Mrs Tailor said she did not know how her signature had come to appear on it. She maintained that she had never agreed to invest the proceeds of the sale and had always intended to use them to buy another home. Even Chan accepted that at least $20,000 remained owing to Mrs Tailor, although the court considered the true amount was likely to have been considerably higher.

 

Roma Gaglio

Another victim was Roma Gaglio, whose family had become involved through the proposed rescue of Vista Furniture. Chan persuaded Mrs Gaglio to assign her share of the proceeds from the sale of the family home and business premises, telling her the money was urgently needed to pay outstanding debts associated with the business. Feeling pressured and wanting to help save the family enterprise, Mrs Gaglio signed an authority allowing more than $23,000 to be paid to Chan because she believed it would genuinely be used to pay the business debts.

 

Instead, the money was used to help cover Chan's own financial problems, including money required to complete the delayed purchase of the Waldrons' retirement unit after Chan had already spent their funds.

 

Frances Chan’s appeal

Following her conviction, Chan appealed both the verdicts and her effective nine-year sentence. She argued that the trial judge had failed to properly direct the jury, questioned the prosecution's decision not to call certain witnesses, challenged aspects of the evidence and claimed the sentence was excessive.

 

The Court of Appeal carefully considered each of those arguments but rejected them one by one. It found that the jury had been properly directed throughout the trial, that the prosecution had proved the offences beyond reasonable doubt and that no miscarriage of justice had occurred. The court also upheld the overall sentence, concluding that the offending involved multiple victims, substantial sums of money, repeated breaches of trust and dishonest conduct carried out over several years.

 

In 2002, the Court of Appeal dismissed Chan's appeal against both her convictions and sentence, allowing the original sentence to stand.

 

Conclusion

Following a lengthy trial, Frances Mary Chan was convicted of six offences and sentenced to an effective term of nine years' imprisonment. The convictions comprised:

• Stealing money entrusted to her by Val and Kenneth Waldron following the sale of their South Yunderup property.

• Fraudulently obtaining a substantial loan from R & I Trustees by making false representations about the ownership and beneficial interests of properties offered as security.

• Stealing additional funds entrusted to her by the Waldrons for the purchase of their retirement unit.

• Stealing further money entrusted to her by the Waldrons in connection with the same property transaction.

• Stealing $23,069.13 belonging to Roma Gaglio after convincing her the money was needed to pay debts associated with Vista Furniture.

• Stealing the proceeds from the sale of Shirley Tailor's Mandurah home after falsely representing that the money was being safely held on her behalf.

 

The case remains one of Western Australia's more significant real estate fraud prosecutions. It demonstrated how trust can be exploited through increasingly complicated property and financial transactions, leaving ordinary people facing devastating financial consequences. Many of the victims had known Frances Chan for years and believed they were helping a friend or someone acting in their best interests. Instead, the courts found that their money, homes and property had been used to support Chan's own financial difficulties, bringing a lengthy course of dishonest conduct to an end with the dismissal of her appeal.