No second chances in real estate

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Everyone has done something they’ve regretted, but could that regret cost you your real estate license?
A recent case before the Real Estate Council of Ontario (RECO) is putting a spotlight on past criminal records and their disclosure when applying and reapplying for a real estate license. But agents on the ground are not feeling pity for those with a criminal past.
“You have this trust issue when you’re going inside a home with a client,” says Linda Mash a real estate agent in Whitby, Ont. “To me, safety is safety.”
But such a broad stroke could be unfair. RECO registrar Joseph Richer says the council reviews each situation on an individual basis, to determine if the applicant still meets the requirements for registration.
“The outcome (of a review) can range from an administrative action to a charge under the Act,” Richer says. “When assessing a situation, RECO needs to determine if the individual is still fit for registration. That information is in section 10.1 of the legislation. If it is believed that the individual can no longer meet the requirements of registration, RECO may issue a proposal to revoke their registration. This is the most severe action the Registrar takes and is reserved for the most serious circumstances.”
While many agents would argue that certain charges are more serious than others, discrepancies still exist. Some agents see a physical assault as an unforgiveable offence, while others say fraud is by far the worst offense a real estate agent can make.
Still, other agents argue the council is simply not equipped to deal with every complaint – whether it stems from a past conviction or a current transaction.
“RECO is not equipped to deal with the hundreds of thousands of transactions every year,” says David Fleming, an agent in Toronto. “They’re not equipped to be the real estate police. And of all the complaints, how many are sour grapes and how many are legitimate? It’s unfair to suggest that RECO should be saddled with every complaint in Ontario.”
That’s likely part of the reason why RECO doesn’t require a spotless record when it comes to licensing real estate professionals. Agents are required to notify RECO within five days of any charges, and failing to do so is a breach of REBBA 2002.
“Any breach of REBBA 2002 and/or the Code of Ethics is taken seriously,” Richer says. “In each instance, RECO will make inquiries, conduct an investigation as required, and take appropriate action.”
For instance, the tribunal that, earlier this month, decided to revoke that agent’s license came to that conclusion as a result of the accumulation of a long list of concerns with that agent’s conduct, which included a criminal conviction.
“The purpose of the Act is to protect the consumer in what is, for most people, the single most significant financial decision they will make,” the RECO tribunal concluded in its report. “Real estate brokers frequently act independently in situations where they are alone with clients. These realities underscore the importance of determining whether a broker can conduct his business with honesty, integrity and in accordance with the law. The Act makes a registrant’s past conduct the basis for this determination.”
Those determinations are made on an individual basis, which Mash contends they should be. However, she agrees that agents need to be responsible in their business practices.
“You need to look at the full story,” she says. “There could have been a legitimate reason (for the failure to disclose). It depends on the scenario.
“But agents need to be responsible and (failing to disclose a criminal record) doesn’t show responsibility, as far as I’m concerned.”
Have your say: Should agents who fail to disclose a criminal record immediately lose their license?