September 21, 2017

Should Fines Should Double For Realtors Breaking Rules?

The Ontario Real Estate Association (OREA) says fines for rule-breaking realtors should be double so the potential penalties keep pace with rising housing market.

Last year, realtors found guilty of violating the code of ethics faced an average fine of less than $6,000 from the Real Estate Council of Ontario (RECO), the industry regulator.  The existing penalties were set when the average resale Ontario home cost $211,000 compared to $619,000 today.

OREA recommended fines be doubled for violating the Real Estate and Business Brokers Act (REBBA) Code of Ethics. That would put the maximum penalty for salespeople at $50,000, while brokers and brokerages would face fines of up to $100,000.

The discussion paper is meant to elicit feedback from OREA’s 70,000 members to the Ontario Liberal government’s review of the real estate act.  New rules are expected in the fall for agents who represent both a buyer and seller in a single transaction.

In addition to the higher fines, OREA says RECO needs to be able to order realtors to return profits made through breaches of the act.  “Fines may not cover the entire fee earned as a result of unethical activity. In other words, even under a system of higher fines registrants could still profit from unethical behaviour,” said the OREA paper.

It also wants RECO to have the authority to revoke or suspend a realtor’s registration to practise, a finding that can be overturned by an appeals tribunal under the current system.

In an emailed statement from RECO registrar Joseph Richer, the regulator also supports higher fines and the ability to make realtors repay profits achieved by unethical practices.  It also agrees with the need to have the authority to revoke registrations.

There were 70,284 registered realtors in Ontario in 2014 and 73,751 in 2015.  But that number shot up to 78,870 last year, according to OREA.  Of those, 48,117 were real estate salespeople.

Colleen Saunders is a 20 year veteran in the mortgage industry, serving Mississauga, Burlington, Oakville and Toronto and offering all mortgage related services such as 2nd mortgages, private mortgages and more.

To contact Colleen, please fill out the form on  www.mortgagesbycolleen.ca  or call 416-459-2406

Article:  https://www.thestar.com/business/2017/08/22/rule-breaking-realtors-should-face-stiffer-penalties-says-orea.html