June 25, 2024

In July 2021, on a balmy summer evening, Amin embarked on his customary post-dinner stroll. He has been a Lorne Park resident for over a decade, valuing the tranquility and lush greenery of the southeast Mississauga neighborhood. His core family and his parents, who frequently visit, shared a humble dwelling there. While sauntering past the larger homes in Lorne Park, Amin made mental notes of architectural details that he envisaged for his future house.

For discretion purposes, Amin requested the use of an alias. He had harbored aspirations of acquiring a spacious family home that offered ample room for his family. When he started searching in earnest in 2020, his real estate agent suggested he consider both existing homes and undeveloped plots. Initially apprehensive due to his minimal knowledge of construction, Amin warmed up to the concept of a home built exactly to his requirements. By autumn, he came across a prime location in Port Credit, a mere 5-minute commute east from his current residence. The 7500-square-foot plot offered ample space for a 4200-square-foot house and a spacious backyard. Amin was thrilled, and he leveraged his existing home for a loan to purchase the land.

His next task was to find the ideal contractor for his dream home. He had been soliciting estimates since the beginning of summer, yet the perfect match eluded him. Most contractors estimated that a preliminary phase of construction, excluding interior finishes, or the rough-in, would cost approximately $575,000 and require 7 to 10 months. Amin wanted a reduced timeline – the sooner his new house was realized, the earlier he could sell his existing property in Lorne Park and offset his loan.

Whilst scouting the neighborhood, Amin noted a two-story house undergoing construction. Its grand entrance, expansive windows, and gabled roofs exuded a modern colonial charm that he fancied. The property advertised a firm named SUM ICF Sip Forming Drain and Concrete – there were signs and two company-branded white vans parked there. Amin promptly dialed the number on display and followed up with a text, expressing his interest in discussing a potential project. Shortly after, he received a call from someone with a baritone voice and a pronounced Eastern European accent—Mike Borac, the owner of the firm. They agreed to meet later in the week at the construction site.

Meet Toronto’s Most Affable Real Estate Fraudster

A few days later, Borac, a strapping man towering at about six feet and weighing roughly 230 pounds, received Amin at the Lorne Park site. Now in his late 50s and sporting civil wear paired with construction boots, he guided Amin around the property owned by a gentleman named Joseph Abichedid. Borac promised Amin a better deal than the other contractors, estimating the rough-in to cost $515,000 and be completed in three months. The entire project would be concluded by Spring 2022, Borac assured, providing a written estimate. His cost-effective strategy involved the utilization of insulated concrete forms (or ICFs) – precrafted polymer walls that are assembled like a jigsaw puzzle, instead of conventional timber.

Borac, who had migrated from Serbia and had accumulated three decades of experience in the sector, seemed competent and seasoned. Amin, though tempted by the promising timeline, remained skeptical. He knew his life savings was at stake and was wary of the offer seeming suspiciously advantageous. To address his apprehensions, Amin contacted Abichedid, the owner of the house that had initially piqued his interest. Abichedid spoke highly of Borac’s proficiency and technical expertise in building. Another client, whose house was under construction adjacent to Abichedid’s, mirrored this positive feedback. After a 30-day period of thorough vetting and consultation with his lawyer, Amin felt assured and finalized the deal with Borac.

Upon being enlisted, Borac requested a $110,000 advance. He justified it as necessary due to the ongoing supply chain disruptions caused by the pandemic, which required material orders to be placed promptly. Amin reluctantly handed over the sum and was given a receipt in return. In October of 2021, Amin secured a building permit from the City of Mississauga, and the project set off at full speed. Working solo, Borac accomplished the excavation within two days – an achievement that left Amin highly impressed, even more so because Borac even worked on a Sunday.

Upon the completion of the digging phase, Borac called for a further $90,000 to cover the cost of windows and doors, sourced from Serbia. Encouraged by the project’s swift progress and Borac’s dedication, Amin complied with the request. However, Amin’s confidence in Borac dwindled a few weeks later when they visited a supplier for plumbing materials. Having received a quote of around $50,000, Borac later assured Amin that his status as a contractor could get them a 50% discount. Intrigued, Amin inquired why Borac wouldn’t just bill him the full amount and pocket the difference. Borac responded with, “I’m fair and very honest.”


Amin issued another cheque, despite a nagging sense of unease, after parting with $200,000

Amin authored a cheque payable to MB General Construction Ltd., a subsidiary of Borac’s SUM ICF. Borac handed the cheque back, insisting it be made payable in his name. When Amin resisted, Borac persuaded him that it was the only way to avail the discount. Amin acquiesced, striving to suppress his rising anxiety. His reservations about dispensing additional cash were strong – after already spending $200,000 – but he realized he had no other option if the project was to progress.

In a couple of months, Amin’s fears escalated. Come spring 2022 – a month past the original project completion timeframe – Borac had failed two city audits related to the foundation’s footings and backfilling (reusing excavated soil to provide structural support). Borac defended the setbacks by blaming an overly meticulous city inspector. In truth, Borac hadn’t complied with the authorized city drawings and had taken shortcuts wherever feasible. It took months to approve the revised drawings, and once they were, Amin dared to believe that the project was back on track.

However, the project hit another roadblock in November 2022 when Borac suddenly ceased to report to the site. He made a variety of excuses to Amin, citing illness, poor weather, and delays in material delivery. Then, in December, Borac took off for Serbia, promising to be away for just a fortnight and to resume work on his return. Two weeks stretched to three, then four, with no trace of Borac. Panicking, Amin tried reaching out to him via calls and texts seeking updates, but they all went unanswered. The subcontracted crew tasked with the ICF work turned up, but with no materials or payment, their hands were tied, and Borac wasn’t responding to their pleas either.

“He’s the most dishonest person we’ve ever encountered in our 41-year tenure in this business,” one of Borac’s suppliers confided.

 
Borac only reappeared in February 2023, and an enraged Amin demanded him to expedite the construction. However, the snail-paced progress persisted. By spring, a year past the stipulated deadline, only 10% of the project – the bottom half of the exterior walls – was completed. Fed up, Amin fired Borac, took charge of procuring the necessary materials and hired the subcontractor to ensure the project got across the finish line.

to culminate the construction of the basement. Importantly, he made a point of collecting the contact details of Borac’s other clients by exploring places that Borac had spoken about and requesting to confer with the proprietors.

By the time mid-April arrived, Amin had accumulated contact details for 11 of Borac’s clients. He incorporated all of them into a WhatsApp group, which he dubbed the Mike Action Group, and dispatched a notification. Amin explained his objective was to address Borac’s disregard for his contractual obligations, pointing out that he himself was down by $235,000 and all he had in return was an excavated pit. Amin partially anticipated being instructed to leave, that he was the sole protestor and that the WhatsApp initiative, a somewhat hopeless pursuit of justice, would expire shortly. He was mistaken. The responses were diverse in their specifics yet uniform in their message: they had all been duped by Borac. He would initiate a project with enthusiasm and determination. Then, once the client had remitted sufficient funds, he would abscond.
 
 
Mike Borac lodges in a residential building close to Hurontario Street and the Queensway. He dresses conservatively, prepares his meals at home and is an ardent supporter of the Serbian national soccer team. He refrains from dating. He was previously married and has a teenage daughter, with whom he spends holidays. Borac was a habitual drinker until about ten years ago when he was apprehended for intoxicated driving. He has remained sober since then, opting for green tea as his preferred beverage.

Naturally named Milentije Djordjevic, he adopted the localised first name of Mike when he migrated to Toronto in the 1980s. Concurrently, he changed his surname to Borac, a Serbian term that loosely means “fighter.” After his migration, Borac, who always had an affinity for manual work, promptly secured employment in downtown demolition. He eventually founded MB General Construction, a company that offers services such as excavation, construction and interior finishing.

By 2007, there were indications of his upcoming offenses. A staff member at Imar Steel Ltd. in Etobicoke claimed that that year, Borac wrote cheques to the company amounting to $25,000, all of which were dishonoured. After numerous attempts to contact Borac via phone, email, and visits to his house during 2007 and 2008, she learnt that Borac had declared bankruptcy and abandoned efforts to recover the funds. “We’ve been in this industry for 41 years,” she disclosed, “and he is the most fraudulent, dishonest individual we’ve ever encountered.”

Related: The Bridle Path mansion, the vanished millions, and the inquiry that exposed a colossal mortgage fraud

In 2022, Borac procured steel worth $34,000 from a Vaughan-based company named Henry Rotberg Steel Corporation, but that cheque was also bounced. When questioned, Borac suggested that the company should attempt to deposit it again – but the outcome was unchanged. The cheque was bounced three times in total; Borac stopped responding to emails. The company initiated litigation against him in civil court, but Borac has failed to settle his dues. “I don’t comprehend how such an individual continues to secure work,” says Henry Rotberg manager Brett Klein, “but there are several such persons out there.”

Klein believes that Borac’s case is indicative of a more extensive issue in the construction sector. “Construction is an extraordinarily unregulated industry. There are no restrictions on individuals claiming to be ‘builders’ or ‘drywallers’ ”. he explains. “We frequently engage with individuals who are clueless about their work, and many handshake agreements that cannot be enforced.”

“I’ve experienced a nightmare. This tragedy has wrecked my financial strategies for the future including my retirement; it’s all gone,” says Amin. “I experience insomnia whenever I dwell on it.”

 
This past March, the Better Business Bureau released a report citing that the riskiest fraud types in Canada in 2022 were scams associated with home improvement, which was up by three positions since 2021 (and recently surpassed cryptocurrency and internet scams in terms of dollar amounts lost). These scams had the highest susceptibility rank, implying that a greater number of individuals exposed to home improvement scams fell for them. In the same month, the Toronto police instigated an investigation into a home renovation scam involving alleged contractors who engaged homeowners to alert them about a leaking roof, received advance cash payment and then vanished. Also prevalent was a widely publicised case involving a Toronto contractor named Adam Gardin, who was handed a prison sentence of three and a half years in 2019 after embezzling $1.24 million for abandoned jobs.

In Ontario, it is mandated for general contractors constructing a home to acquire a license from the Home Construction Regulatory Authority (HCRA). The licensing procedure consists of passing coursework and examinations or otherwise demonstrating proficiency in seven distinct categories, such as business management, building codes, and housing legal issues. The process spans roughly 14 days, usually over several months, and costs in the range of $3,700 to $6,800. Candidates must also clear credit, judicial and criminal record checks.

The HCRA possesses the authority to penalize builders who breach its ethical code by operating without a license or neglecting to register a new home in the warranty program. The repercussions can vary from obligatory educational programs to fines as steep as $50,000 to license revocation. However, numerous contractors bypass the system altogether. Mike Borac and his company names don’t appear in a search of the HCRA database. How can the HCRA penalize someone of whom it has no knowledge?

Recently this year, Borac neglected to pay $79,439 to Penco Drywall Ltd., a home construction contracting firm in Mississauga that he had engaged for a project. The president of Penco, Brad Pierce, mentions that his firm usually insists on payment directly from homeowners, however, Borac circumvented this process and had the homeowner remit the payment to him instead. After several weeks of efforts to extract the money from Borac, Pierce acknowledged that it was a lost cause. “We were swindled out of $80,000,” he claims. The company attempted to recoup the funds in civil court but forfeited the effort after a few months.

Related: A dishonest cop, a dead individual and a $800,000 estate fraud

Between 2008 and 2023, Borac—who operated under at least two business identities, MB General Construction and Mike Borac General Construction Ltd.—was prosecuted eight times in civil court by small to medium scale businesses that he had defrauded. He was also targeted by the Ontario Ministry of Labour for $12,000, in 2018. The ministry refrains from commenting on specific cases, but it is likely that the amount Borac owed was for unpaid wages to subcontractors; if Borac fails to remit the sum, the ministry has the option of recouping the amount by seizing property or garnishing bank accounts. The cumulative amount Borac owes in correlation with all these cases is an astounding $800,000.
 
 
After exchanging horror tales on WhatsApp, eight of the 11 participants in the Mike Action Group decided to congregate offline. They gathered at the office of one of the victims in Mississauga. A certain Dhyan Virk, one of the members, who had plans to construct a residence in Lorne Park, the same locality where Amin was domiciled. Borac, whom he had become acquainted with via a friend, provided him a favourable quote for the project, about $50,000 less than other contractors, for everything excluding plumbing, electrical and insulation. Borac demanded a down payment of $160,000, justifying that the costs of materials had escalated and orders had prolonged processing times. He performed the demolition and excavation and then ceased responding to Virk’s communication attempts. The entire professional interaction lasted a brief six months.

Yet another participant of the Mike Action Group and his spouse had resided for two decades in a humble three-bedroom home in Whitby, where they had raised their daughter. The couple had saved for nearly a decade, routinely setting aside a portion of each paycheck, and in 2018, they acquired a property in Mississauga for $1.27 million with the intention of teardown. The property owner evaluated three different builders, who all quoted prices between $1.3 and $1.4 million for the project. At that point, he got acquainted with Mike Borac. He toured a few of the homes that Borac had built, which seemed impressive, and Borac offered to undertake the job for $1.25 million. That’s when heBorac, similar to how he approached Amin and Virk, coerced the homeowner into making a substantial payment upfront – weighing in at $180,000. He then requested an additional sum of $140,000, followed by a further $100,000. Borac’s commitment to the work was patchy and unreliable: he twice took trips to Serbia in a span of two years, shuttered the construction site repeatedly, and failed a municipal inspection all while leaving the property unfinished. As time wore on, the homeowner had poured a whopping $560,000 into the inevitable white elephant. Just like other people who fell into Borac’s traps, his increasing investments made him more prone to continue doling out payments.

![Mike Borac, a Toronto contractor accused of serial reno fraud](https://investmentshoax.com/wp-content/uploads/2024/04/BAD_BUILDER_FINAL03-scaled-368×0-c-default.jpg)
*Mike Borac, a Toronto contractor accused of serial reno fraud; Borac frequently failed to secure the necessary supplies for the construction site or pay his subcontractors, leading to a situation with idle workers*

Borac was probably banking on the property owner’s continuing willingness to shell out. This principle is commonly referred to as the sunk-cost fallacy, the human propensity to push forward with a commitment because of the significant investment of time, money, or effort, regardless of the clear insufficiency of potential gains. The principle explains why we persist with uninteresting books or endure mediocre movies. The property owner, similar to Amin, could have dismissed Borac and hired a substitute contractor, but he had already parted with an enormous sum. Instead, he held onto his hopes.

Ultimately, his optimism was misplaced. The homeowner has had to expend an extra $450,000 to gradually complete the construction, hiring workers from nearby sites. The expectation is that finishing the project by the end of the year will require even more outlay. Discouraged by the situation, the homeowner solemnly states, “The total cost is hard to determine. Retirement will have to be delayed. The uncertainty about funding sources adds to the strain.”

The upset parties gathered in April and resolved to take legal action to recover their funds. Following a lawyer’s advice, a filed police report alleged that, between 2017 and 2022, Borac had swindled 10 or more homeowners out of approximately $1.7 million. This culminated in Borac’s arrest by the Peel Regional Police Department.

Even after his apprehension and release on bail, Borac managed to continue contracting in the GTA by using an alias, steering clear of the negative press associated with his real name. To boot, Borac’s unscrupulous actions did not trigger any warnings in the HCRA database due to his lack of registration.

When Joseph Abichedid referred Borac to other potential clients, he insists it was made in good faith, “I believed he had good intentions.” But everything went downhill when Borac fell behind on payments and his absence became more frequent. Taking matters into his own hands, Abichedid took up project management duties and hired his own crew. Despite Borac owing him about $300k, Joseph remains hopeful that Borac can complete a few jobs to make some amends.

Nevertheless, not all individuals share Abichedid’s optimism regarding Borac’s ability to make amends. Reflecting on the whole saga, Amin simply says, “This ordeal ruined my financial plans for the future.”

This story was featured in the October 2023 edition of Toronto Life magazine. You can subscribe for just $39.99 a year [here](http://www.torontolife.com/subscribe). To buy single issues, [click here](https://canadianmags.ca/collections/toronto-life-single-issues).