An investigation into a GTA-based brokerage’s mismanagement of millions of dollars will remain with the provincial regulator for now, even though police have been contacted.
On Friday, the Real Estate Council of Ontario (RECO) contacted the Peel Regional Police’s fraud bureau notifying them of its ongoing investigation into “potential improprieties” within iPro Realty, according to Peel police.
The Star has asked RECO to confirm their investigation and provide details, but has not yet received a response.
On Aug. 14, RECO announced it was shuttering its branches by Aug. 19 due to a significant shortfall of $10 million in commission and deposit trust accounts. RECO has since revised the amount missing to $8 million, but provided no reason for the change.
“At this stage, the investigation remains with RECO and falls within the regulatory agency’s mandate,” Const. Sarah Patten said in a statement to the Star on Monday.
“Although a criminal investigation has not yet commenced, a referral from RECO to the police may occur in the future subject to the fraud bureau’s receipt of a full briefing with respect to RECO’s findings and available evidence to date.”
Once that is done, the fraud bureau will assess the information to see if criminal proceedings are needed, the statement read.
The Ontario Provincial Police (OPP) may also be asked to investigate a matter outside of its jurisdiction at the request of another police service or a government agency, said OPP’s media relations, acting Staff Sgt. Jeffrey Del Guidice.
“If the OPP receives a report of alleged criminal activity, including fraud or more complex financial crime or corruption, that has occurred in OPP jurisdiction, the OPP will investigate the matter to determine if a criminal offence has been committed,” he said.
The same day RECO announced it was shuttering iPro, its cofounders — Rui Alves and Fedele Colucci — told its staff that a “wealthy private financier” was rebranding their brokerage to iCloud Realty, which would assume the same offices, phone numbers and software as iPro. The brokerage’s 2,400 agents had a few days to decide if they wanted to transfer to iCloud or move to a different brokerage. If they decided to transfer to iCloud, RECO would assist in the “bulk transfer” of agents.
Alves and Colucci sent an email to employees on Friday, saying that “We negotiated at length with RECO and secured an agreement with RECO,” and as part of that agreement, “RECO would approve a bulk transfer of all iPro agents to iCloud Realty on Aug. 18, so that no agent would lose registration. However, RECO only approved iCloud’s brokerage on Aug. 8, once our agreement with RECO was finalized.”
RECO said that iCloud is registered as a separate brokerage with different owners from iPro listed on the registration, and that the iPro cofounders have been stripped of their licences. It added iCloud had purchased some of iPro’s assets and assumed some of its leases.
Alves was on RECO’s board of directors for several years, departing in 2023, according to the regulator’s annual general meeting on May 2023.
