Everyone has covered iPro Realty Ltd. Missing millions, frozen trust accounts, lawsuits, and a regulator that failed to catch it in time. The headlines have been relentless.

Recent public statements from association leadership have echoed this outrage, calling the scandal “deplorable” and pledging to do everything possible to prevent a repeat. In the same breath, however, those statements concede that associations lack authority to intervene directly. That contradiction, angry but powerless, deserves scrutiny.

What almost no one has covered is the irony of what followed: boards and associations rushing into the spotlight to demand change.

The letter

On Sept. 3, nine of Ontario’s largest boards joined the Ontario Real Estate Association (OREA) in a public letter calling for the Real Estate Council of Ontario (RECO) to be placed under the Ontario Ombudsman. The letter reads, “Make RECO subject to independent oversight by the Ontario Ombudsman.”

It sounds bold.

It isn’t.

The Ombudsman’s own statute is explicit. Section 14 of the Ombudsman Act bars complaints about self-regulating professions such as lawyers, doctors, or nurses. RECO is a delegated administrative authority, funded by industry but operating at arm’s length, and therefore outside its jurisdiction.

If what boards really mean is that Ontario should legislate RECO into a fully public agency subject to Ombudsman oversight, then they should say so. Instead, they imply the Ombudsman already has that power. That is not advocacy. It misstates the effect of the statute.

Which leaves two explanations:

• Boards may not fully appreciate the limits of the Ombudsman’s role; or
• They do, but have not been fully clear with members about what their ask really means, which is the end of self-regulation.

Either way, Realtors deserve clarity from organizations funded by their dues.

Compliance vs. regulation

This distinction matters. 

Boards enforce MLS rules and the Realtor Code. That is compliance. Compliance means setting professional standards for how members interact with one another, how listings are input and displayed, and how disputes within the membership are handled. At its best, compliance keeps the MLS orderly and the professional culture consistent. It is inward-facing, designed to manage the conduct of members within an association.

Regulation is different. Regulation belongs to the state. RECO audits trust accounts, suspends registrations, and prosecutes misconduct under TRESA. Regulation is outward-facing, with the authority to protect consumers, safeguard deposits, and impose penalties that go well beyond membership discipline. Unlike compliance, regulation carries the force of law.

The two roles are not interchangeable. A board can fine a member for breaching MLS policy, but it cannot seize a trust account or revoke a license. RECO can. A board can enforce courtesy and accuracy in listing data, but it cannot investigate fraud or order restitution to a consumer. RECO can.

Conflating the two is not advocacy, it is overreach. And if we acted outside of our competence the way boards are attempting to, they would face RECO discipline.

Precedent they will not say out loud

The ask for Ombudsman oversight is not an abstract gesture. There is precedent, and it tells us exactly what this would mean.

In British Columbia, self-regulation collapsed after a 2016 investigation into shadow flipping and assignment fraud. The provincial government acted swiftly. The Real Estate Council of B.C., once the industry’s self-regulator, was stripped of authority. Oversight was shifted to the Superintendent of Real Estate. By 2021, regulation was fully consolidated under the B.C. Financial Services Authority (BCFSA).

The industry’s self-governing experiment was over.

In Québec, the same outcome arrived earlier. In 1994, the government created the OACIQ, a statutory regulator reporting directly to the Ministry of Finance. The move followed years of concern about weak enforcement by the industry’s predecessor body, the ACAIQ. The province concluded that consumer protection required a public regulator.

These are not tweaks. They are full structural shifts away from self-regulation.

So, if Ontario boards understand these precedents, they are quietly asking to end self-regulation without saying so outright. If they do not, then they are making an ask without appreciating its true implications. Either way, Realtors are left in the dark.

Ontario’s pattern of failure

This is not the first time governance in Ontario real estate has failed the public.

RECO has long been criticized for being reactive rather than proactive: slow to audit, slow to respond to complaints, and often opaque in its processes. The iPro scandal is the latest headline, but it is not an isolated event.

Boards have their own pattern. As of September 2025, RECO’s public discipline database lists decisions involving some sitting directors of Ontario real estate boards. These are breaches of the same statute that boards now want to advise on. 

A body led in part by individuals sanctioned under the very law they seek to shape cannot credibly position itself as an authority on regulatory reform. That tension should matter to every Realtor asked to fund these advocacy efforts.

That alone should give pause before positioning boards as credible voices on regulation.

Authority without liability

Brokerages carry liability. They hold trust accounts. They manage compliance systems. They face consumers when deals collapse. Registrants carry personal liability under TRESA.

Boards carry none of that risk. They can make public statements, lobby governments, and issue demands without ever sharing the burden of liability.

That is authority without liability. It is not advocacy. If it’s anything, it’s performance without consequence.

Advocacy failure

Boards defend their role by pointing to advocacy as part of their mandate.

Sure, but advocacy without accuracy is malpractice.

If the Ombudsman cannot, under statute, take jurisdiction over RECO today, then telling the public otherwise is misleading.

If boards actually mean that self-regulation should end, then failing to tell their members directly is not transparent.

And if boards acknowledge they cannot directly intervene in the very scandal prompting these calls, then how can they claim authority in reshaping the rules of regulation itself?

Either way, Realtors are paying for advocacy that fails the test of accuracy.

From symptom to system

The Ombudsman letter is not an isolated misstep. It is a symptom of a deeper imbalance in organized real estate: boards exercise authority without liability. They lobby on regulation while carrying no regulatory risk. They control essential infrastructure while carrying no ownership duty.

If we want oversight that works, it is not enough to fix RECO. We need to fix the system that empowers boards to misstate and overreach in the first place.

A structural fix

Members fund the show, yet they never vote on the script. If boards want to call for external oversight, they should accept internal oversight first. That requires structural reform.

A share-capital model is not radical. It is alignment. It means that those who carry the liability, being registrants and brokerages, also carry the authority.

Here’s how it could work:

Shares would be issued to brokerages and individual Realtors. Votes could be capped to prevent dominance by any single firm, with limits on how many votes one shareholder can hold. Major decisions (structural mergers, policy positions, advocacy campaigns, large financial commitments) would require shareholder approval. Directors would answer to owners, not just to each other. With modern platforms, registrants could cast those votes electronically in days, faster than boards now move behind closed doors.

And we already have a precedent set.

Associations behave like corporations by outsourcing essentials into for-profit subsidiaries. MLS systems are the clearest example. Ontario’s MLS infrastructure has consolidated onto a dominant, board-controlled platform used by most Realtors in the province. The sole shareholder is one board. Other associations subscribe, but they do not govern. In corporate law, directors owe their duty to the corporation. When that corporation’s sole shareholder is one board, governance incentives align with that board. Subscriber associations are counterparties, not owners.

That matters.

Contract rights are not control rights. Advisory councils advise; they do not govern. Exiting a province-wide MLS is theoretically possible and practically punitive. The most important tool Realtors have is controlled by an entity that owes them no ownership duty and where they hold no votes.

What should be for us and by us is neither.

And yet associations still applauded this arrangement. By subscribing, they subordinated their members’ governance voice to a competitor’s corporate control. That is not collaboration. It is a surrender of member sovereignty.

A share-capital model flips the script. Instead of boards owning the corporation Realtors rely on, Realtors would own the corporation boards rely on. It makes ownership explicit. It gives Realtors direct votes on advocacy. It forces disclosure of lobbying. It requires governance frameworks to expire on a fixed cycle unless renewed. And it ensures that when boards speak, they do so with a mandate earned from those who carry the liability.

The MLS precedent proves the door is open. Essentials can be corporatized. The only unresolved question is whether Realtors will remain disenfranchised subscribers or become owners. This is the natural endpoint of trends boards themselves have set in motion.

Conclusion

There are only two explanations for the Ombudsman ask. Either boards do not fully understand the system, or they do, and are not telling members the truth. Neither is acceptable.

If Ontario is moving toward the B.C. and Québec model, then say it plainly. Admit what is really on the table. And put the people who actually carry liability at the center of the conversation.

Oversight without liability is theatre, and the play has gone on long enough.

Brandon Reay

Brandon Reay brings a multifaceted background in real estate practice, policy, and governance. Before stepping into brokerage leadership, Brandon spent several years in organized real estate, contributing to strategic initiatives and advocacy efforts with CREA and OREA, and various Chambers of Commerce. His work has included shaping housing policy, supporting regulatory reform, and improving REALTOR® engagement across the country.

Brandon’s approach blends hands-on brokerage experience with a systems-level understanding of how policy, market forces, and professional standards intersect. He is known for helping professionals navigate evolving market conditions and advocating for higher standards within the industry. In addition to his leadership role at RE/MAX Hallmark Realty Group, he remains an active REALTOR® focused on agent development, business strategy, and client service.

Brandon regularly contributes commentary on market trends to media outlets and industry publications and has served as a spokesperson on housing issues in Ottawa. He is also a frequent speaker at real estate events, offering data-driven insights on brokerage strategy, professionalism, and the future of the industry.

He holds a Master of Business Administration from the Sprott School of Business. Brandon lives in Ottawa, where he remains closely involved in local policy discussions on housing affordability and real estate governance.