New filing rules in place for Ontario real estate brokerages in wake of iPro Realty scandal

Real estate sale signage is shown on a street in Oakville, Ont., west of Toronto, on Thursday, Nov.7, 2024. THE CANADIAN PRESS/Richard Buchan

Ontario real estate brokerages will now be required to submit annual financial filings to the province’s industry regulator as part of a plan to “strengthen financial oversight” in the wake of the iPro Realty scandal.

As of Oct. 1, 2026, all brokerages must “attest to” and submit an annual financial filing to the Real Estate Council of Ontario (RECO).

“Complemented by RECO’s audit and inspections framework, this proactive oversight model will require brokerages to regularly provide documentation demonstrating proper financial management and compliance with the Trust and Real Estate Services Act, 2002,” RECO said in a news release.

“Furthermore, RECO will use this data to inform its risk framework and focus regulatory resources where risks to consumers are greatest.”

These measures come after the regulator found last year that co-founders of iPro Realty allegedly misused about $8 million from trust accounts to pay for operating expenses and payments to investors, cash that should have been used for down payments and realtor commissions.

In the wake of the allegations, the Ontario government took control of RECO in late 2025, appointing Jean Lépine to take over as acting CEO.

“Ontarians buying or selling a home should have complete confidence that deposits are protected,” Stephen Crawford, Ontario Minister of Public and Business Service Delivery and Procurement, said in the news release.

“This initiative delivers on our government’s commitment to strengthen consumer protection, improve oversight and address risks before they escalate.”

The filings submitted by brokerages must include information from their financial statements, information about trust assets and liabilities, information about unclaimed trust monies held by brokerages, as well as compliance attestations by the broker of record.

“Sector leaders agree that RECO must use every tool available to protect consumers from any financial mismanagement by brokerages. These changes will help RECO spot red flags earlier, intervene rapidly, and take timely and effective regulatory action where consumer funds and commissions are at risk,” Lépine said in the release.

The changes, RECO said, “align with modern regulatory risk management practices,” and the regulator said it intends to introduce monthly trust reconciliation reporting requirements next year.

“Together, the new annual requirements and future monthly submissions, underpinned by RECO’s audit framework, mark a definitive shift towards a more proactive, data-informed regulator,” the news release read.

“By establishing this robust financial reporting standard, RECO aligns Ontario with regulatory best practices in other jurisdictions, better safeguarding consumer funds and reinforcing long-term confidence across the sector.”