Ontario brokerage collapse raises questions about oversight

The collapse of the fourth-largest real estate brokerage in Ontario, with close to $8-million missing, is raising questions in the industry about whether its financial oversight regulations are adequate.

According to Joseph Richer, the registrar of the Real Estate Council of Ontario (RECO), which acts as the licensing body and regulator in the province, his organization has known since May that iPro Realty Ltd. had mismanaged its legally protected trust accounts that held millions of dollars worth of consumer downpayments and realtor/agent commissions. It wasn’t until months later, on Thursday, Aug. 14 that RECO disclosed that the brokerage, owned by Riu Alves and Fedele Colucci, with its 2,400 agents, was being shut down by Aug. 19. Mr. Alves and Mr. Colucci had their licences to trade real estate suspended as of that same date.