I’d like to share two messages with you with regards mortgage fraud. The first one is from Phil Soper President and CEO of Royal LePage, the second message is from Joseph Richer, Registrar for RECO – Real Estate Council of Ontario
Important message from Phil Soper re: mortgage fraud
To: Royal LePage Broker/Owners, Managers, Sales Representatives and Administrators
It has come to our attention that some real estate professionals in Canada are committing fraud by facilitating, for a fee, the fabrication of false employment, income and tax documents, for the purpose of obtaining mortgages for their homebuyer clients who may not otherwise meet strict borrowing qualifications.
The findings in this CBC Marketplace report are serious and disturbing. Unfortunately, the poor choices of a few can have devastating consequences for our industry’s reputation as a whole.
Royal LePage unequivocally condemns this unethical practice, and will have zero tolerance for such behaviour. Any agent or broker operating under the Royal LePage brand, or any of its affiliated brands, who engages in fraudulent activity, or is found to deliberately mislead consumers, will face disciplinary action.
Royal LePage is a company built on a strong foundation of integrity and professionalism. Our network of real estate professionals has earned Canadians’ trust by upholding these principles and acting in the best interest of our clients. Canadians know they can count on Royal LePage to act honestly and respect the highest standards of our industry.
Sincerely,
Phil Soper
President & CEO, Royal LePage
Statement from the Registrar
PROFESSIONAL RESOURCE
October 28, 2022
Mortgage fraud is illegal
We are aware of recent allegations that some real estate agents and brokerages in Ontario are facilitating mortgage fraud. To whatever extent this is happening, it must stop.
We are investigating these allegations and assessing next steps.
Be assured that RECO will prosecute any registrants who are proven to have engaged in mortgage fraud.
Such conduct is a breach of the Real Estate and Business Brokers Act, 2002 (REBBA) and also breaches other laws, including the Criminal Code of Canada.
Prosecution for falsifying information or assisting in the falsifying of information can result in fines up to $50,000, prison for up to two years, or suspension or revocation of the agent’s RECO registration. More severe penalties could be levied if individuals are convicted under the Criminal Code.
It is also illegal for a real estate agent to ask a consumer for money to get their loan approved.
RECO takes this matter seriously and encourages anyone with evidence of mortgage fraud occurring to report it to authorities, such as the Financial Services Regulatory Authority (FSRA), which regulates mortgage agents, RECO, or the local police service. You can file a complaint with RECO here.
In addition to being illegal, such activity undermines consumer protection and confidence in the real estate sector. We expect all real estate professionals to support us in driving home the message that there is zero tolerance for this behaviour in the real estate industry.
Mortgage fraud is illegal and we must all work together to prevent it.
Joseph Richer Registrar, RECO
