The man who cut a deal with two realtors who illegally took more than $10 million from their brokerage’s trust accounts has lost his job.
A day after the Star broke the news that Joseph Richer, long-time registrar at Ontario’s real estate regulator, had agreed not to charge or fine iPro Realty’s co-founders for taking an unprecedented amount from the company’s trust accounts, the head of the Real Estate Council of Ontario (RECO) issued a statement that stunned many in the industry.
“With the support of RECO’s board of directors, I have acted and effective August 22, Mr. Joseph Richer, the Registrar appointed under the Trust in Real Estate Services Act, 2002, has left RECO,” said Brenda Buchanan, the regulator’s CEO.
“This is the biggest mismanagement of funds in the Ontario regulator’s history,” said Brandon Reay, an Ottawa broker who writes about the industry’s governance for trade publications. “They’ve removed a figurehead but RECO’s system allowed this to happen.”
Others in the real estate industry told the Star they find it implausible that Richer acted in defiance of RECO’s board, management and in-house legal team in allowing iPro Realty and its 2,400 agents across the Greater Toronto Area to continue operating after discovering the shortfall in late May.
”(Richer) didn’t act alone,” said Nicole Koteff, a lawyer who spent seven years as RECO’s in-house counsel, prosecuting real estate agents and brokers. “Something of this magnitude, there’s no way. This is too big.”
In a statement released on Friday afternoon, Buchanan said she is “committed to working closely with RECO’s board to provide transparency, oversight and accountability on this matter. This is my top priority.”
Buchanan did not respond to the Star’s questions about whether a new registrar could reverse Richer’s deal with iPro Realty’s co-founders.
Koteff said it is possible.
“If he acted outside his authority and against the interest of consumer protection, there is a possibility that a new registrar might seek to retract Richer’s agreement,” she said.
After RECO discovered an initial $10.5 million shortfall in iPro’s trust accounts in late May, it waited three months to notify the public and its own industry about the consumer deposits and agent commissions missing from the trust accounts. During that period, the brokerage conducted more than $700 million in residential sales, MLS data obtained and analyzed by the Star reveals.
Grant Duthie’s East York home is among more than 700 real estate transactions that RECO allowed iPro Realty and thousands of its agents across Greater Toronto to carry out after it identified “a serious breach of the law by the owners” in late May with the misappropriation of more than $10 million in deposits and commissions that was supposed to be held in trust.
An iPro agent sold Duthie’s home in early July for a little more than $2 million.
“The buyers put up $100,000 and who knows where that money is,” said Duthie, a securities lawyer who specializes in corporate finance.
Duthie said he’s received “no clarity or comfort” from RECO and called the regulator’s response to the massive financial mismanagement “a complete joke.”
“The securities regulator would have put them into receivership that day,” Duthie said. “It’s galling that RECO would admit to knowing of the shortfall and have no context for why they didn’t take immediate action. It’s either a massive miscommunication or gross negligence.”
Earlier this week, the co-founders of iPro Realty — Rui Alves and Fedele Colucci — “voluntarily terminated” their RECO registrations after the regulator’s investigation concluded “the brokerage illegally disbursed funds from the brokerage’s consumer deposit and commission trust accounts, in contravention of the Trust in Real Estate Services Act, 2002,” RECO’s website states.
Residential MLS sales data obtained and analyzed by the Star shows iPro Realty’s agents participated in nearly 730 residential transactions between June 1 and Aug. 19, when RECO ordered iPro to close its brokerage and 17 offices. These deals represent more than $700 million in transactions.
Brokers for iPro Realty acted as listing agents in 363 of these transactions. Typically, a listing brokerage holds the funds. Deposits and commissions related to nearly $340 million in home sales between June 1 and Aug. 19 were directed to iPro’s trust accounts.
The Star’s data does not include commercial transactions, lease deals, exclusive listings, pre-construction or assignment sales.
Assuming the $340 million in sales where iPro agents handled the listing resulted in a 5 per cent deposit, a standard rate that typically covers commissions, the transactions would have triggered the flow of an additional $17 million into iPro’s trust accounts after RECO first learned the company’s co-founders “misappropriated” millions.
“That’s a huge amount,” said Koteff, who started an independent legal firm after leaving RECO and provides expert legal reports for court cases on the standard of care required by brokerages and their agents.
“I think consumers would want to know, are my deposits safe? How was RECO ensuring the millions in deposits submitted to iPro were safe? That the money went into the trust and will stay in the trust until those transactions close?”
Buchanan and Richer declined the Star’s requests for interviews to discuss the iPro investigation, its delay in alerting the public to the brokerage’s illegal financial activity and concerns raised by a 2022 Auditor General’s report, which found the regulator was ineffective in fulfilling its consumer protection mandate.
When the Star asked RECO why it waited three months to alert consumers to iPro Realty’s illegal activity, a spokesperson replied by email, saying the regulator wanted to give the brokerage’s co-founders time to return the money.
“Since the initial inspection of iPro in May 2025, RECO has closely monitored its trust account activity,” Richer told the Star in an email earlier this week. “This has included monitoring the repayment by iPro’s owners of approximately $3M following the sale of some of iPro’s assets.”
The regulator updated iPro’s shortfall to less than $8 million after the repayment.
“RECO’s approach has been to recover the greatest amount of trust money possible to protect the maximum amount of funds for consumers and agents,” Richer wrote in an email to the Star.
RECO alerted the public to iPro’s financial breaches on Aug. 14, announcing it had finalized an undertaking with iPro Realty that will see the windup and closure of the Mississauga-based brokerage and all of its 17 branches, and that a new real estate brokerage called iCloud would absorb some of iPro agents and their clients.
Prior to May, RECO told the Star that it last audited iPro Realty in 2021.
The Star’s attempts to reach Alves and Colucci for comment by email, phone, social media, through family members and RECO were unsuccessful.
Royal LePage agent Steven Smurlick is anxiously awaiting the Sept. 5 closing date of a three-bedroom, four-bathroom property in Milton that one of his clients purchased in the summer.
Smurlick expects the deal to close, but there’s no certainty. Tens of thousands of dollars are on the line, including the client’s $40,000 deposit and Smurlick’s $21,500 commission.
“The first direction I received once news broke about iPro was to submit a claim with RECO as soon as possible,” Smurlick said. He connected with the regulator’s insurance claim adviser.
“They told me to tell the buyer to get in touch with their lawyer to put in an insurance claim for their deposit. The buyer’s lawyer knew about it immediately and will take whatever precautions necessary to make sure the deal closes and the buyer will have his house, that’s what we’re hoping,” he said.
“Agents are only as good as their last deal … and now you close a deal and you might not get paid, it’s very disconcerting and stressful. I have to cross my fingers and hope.”
With data analysis by Nathan Pilla
