Real estate leaders call for answers after unexpected ruling
The Real Estate Council of Ontario (RECO) has confirmed that iPro Realty co-founders Rui Alves and Fedele Colucci will not face charges, despite millions of dollars going missing from the brokerage’s trust accounts.
In an email to the Toronto Star on Thursday, the regulator said its registrar agreed “to not seek charges under his authority under the Provincial Offences Act, and to not take any further administrative action under the Trust in Real Estate Services Act, 2002.” Alves and Colucci instead terminated their registration as brokers, with Alves agreeing never to reapply.
The decision has drawn sharp criticism from industry leaders. “How?! How?!” said John Meehan, a former president of the Toronto Regional Real Estate Board (TRREB), in an interview with the Star. “Hopefully, there will be some sort of disclosure as to how Joe (Richer, RECO’s registrar) arrived at that decision.
On LinkedIn, well-known mortgage broker Ron Butler slammed the decision and called for the resignation of RECO’s board. “This is so offensive & appalling everyone on the Board & ever Executive MUST GO,” Butler wrote.
“The Provincial Government MUST move swiftly to remove the leadership of RECO & take over its operation until an entire new Board & all new Management can be put in place.”
According to RECO, iPro’s owners first disclosed a shortfall in late May before a scheduled inspection. Richer later confirmed the last audit of the brokerage occurred in 2021. On August 14, the regulator announced the brokerage would be shuttered due to a $10.5-million deficit in its consumer deposit and commission trust accounts. At the time, Richer described the finding as “a serious breach of iPro’s responsibilities under the law and to its consumers and agents.”
The following day that iPro, which employed 2,400 agents across 17 offices in the Greater Toronto Area, would close on August 19. Agents had been assisted in transferring to new brokerages following the shutdown.
On the day of closure, Alves and Colucci’s registrations were formally terminated. RECO’s website updated their discipline history, stating both men had “illegally disbursed funds” from trust accounts. The Star reported on August 21 that they had repaid about $3 million through the sale of assets, reducing the shortfall to less than $8 million.
Consumers and agents continue to face consequences. Commissions owed to agents must be claimed through insurance, capped at $200,000 per individual and $4 million in total payouts. Buyers and sellers with deposits held by iPro have been directed to confirm the status of funds through their agreements or to file claims where necessary.
RECO has notified Peel police’s fraud bureau of “potential improprieties” and said it will support any investigation. The regulator emphasized that its decision not to pursue charges does not prevent a criminal probe.
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