TRREB Statement: Value for Money Audit of RECO by the Auditor General of Ontario
TRREB was pleased to participate in the consultation by the Office of the Auditor General of Ontario (OAGO) in conducting a RECO value for money audit and is encouraged by the response from the Ministry and RECO to act on a number of recommendations in the audit report. Effective oversight of the real estate industry is critical. So is effective oversight of the regulator, RECO.
TRREB has long held that there is no place in our profession for those who act unethically. For far too long, the reputation of many hardworking REALTORS® who work tirelessly on behalf of their clients has been tarnished by the actions of a few who have no place calling themselves a REALTOR®.
TRREB has called on the Real Estate Council of Ontario (RECO) for many years to address concerns about unethical behaviour. REALTORS® have themselves advocated for higher standards with no measurable result. The time for RECO to act is now.
Recent occurrences such as the major breach in exam integrity mentioned in the audit as well as media reports concerning REALTOR® involvement in potential mortgage fraud highlight these bad actors.
TRREB has a professional standards process where we hold Members to account. Our regulator needs to do the same if their role as the issuer of licenses and regulator of the profession is to be effective.
As part of their investigations, RECO should also ensure brokerages are providing effective oversight as required by the Real Estate and Business Brokers Act – soon to be the Trust in Real Estate Services Act (TRESA). Brokers of Record have a responsibility for the actions of their REALTOR® Members, and if pervasive abuses are evident within an organization, RECO should evaluate the fitness of the Broker of Record.
Furthermore, in all instances RECO should take decisive action and revoke the license of any real estate agent if there is proof of fraudulent behaviour.
The findings of the RECO value for money audit point to the need for the province to finally institute on oversight body for RECO by way of an ombudsperson. The government needs to consider an oversight body for the regulator since 74 per cent of complaints filed to RECO are from consumers, 24 per cent from registrants and 2 per cent other.
Most industries, and the real estate industry in other provinces, fall under an ombudsperson, and this is an area that requires attention since Ombudsman Ontario does not watch over RECO.
RECO is overseen only by the Ministry of Public and Business Service Delivery. However, the Ministry does not have the mandate or authority to deal with complaints regarding RECO. This means that RECO is not subject to the same oversight as other self-regulated/managed organizations. RECO would therefore benefit from additional oversight to provide transparency and accountability.