In the final eight months of iPro Realty’s operations, co-founders Rui Alves and Fedele Colucci diverted more than $30 million in trust money to accounts that paid themselves, their companies, their spouses and investors, according to a preliminary review of the company’s books by a forensic accountant.
The review is among hundreds of pages of affidavits and exhibits filed in Superior Court on Friday by the Real Estate Council of Ontario (RECO) that the regulator said shows the founders of one of Ontario’s largest real estate companies “systematically misused trust funds, moving them into operating accounts and related companies, and, through direct payments to themselves and their associates.”
Alves and Colucci, RECO added, “not only betrayed the trust of thousands of Ontarians but also misled other parties who relied on their compliance … by operating multiple accounting systems, falsifying records, and delaying disclosure until immediately before a scheduled inspection.”
The allegations have not been proven in court.
RECO is seeking an emergency injunction to freeze the accounts and assets of iPro Realty, its co-founders and six related companies. Justice William Black is expected to rule on the application during a virtual hearing on Monday at noon.
The court filings, which span more than 600 pages, include details of the controversial deal the regulator signed with Colucci and Alves to avoid charges and fines after it discovered a $10.5-million shortfall in the brokerage’s trust accounts in May. RECO told the Star the iPro scandal is the largest financial breach it has ever investigated.
The undertaking shows the co-founders promised to give up their real estate registrations and sell their business for $3 million to a new company called iCloud before July 31. Money from that sale was to be returned to the brokerage’s trust accounts to offset the shortfall.
While the sale was required to take place by end of July, the undertaking wasn’t signed until Aug. 8. The undertaking also does not explain why RECO allowed iPro to conduct more than $700 million in real-estate transactions for three months before notifying the public and shuttering the brokerage, which employed 2,400 agents across Greater Toronto. The document does not indicate why RECO assisted in the mass auto-transfer of iPro realtors to iCloud on Aug. 19.
“RECO’s priority remains protecting Ontario consumers and registrants and is pursuing every available legal avenue to freeze assets, trace the flow of diverted funds, and recover money back into the trust accounts,” the regulator said in a statement on Friday.
Neither Alves nor his lawyer responded to a request for comment. Colucci’s lawyer Gabriel Gross-Stein told the Star his client has no comment.
RECO was initially scheduled to inspect iPro’s financial records on April 30, 2025, according to an affidavit from the regulator’s CEO Brenda Buchanan.
But iPro delayed the audit twice, saying it needed time to prepare for Toronto Regional Real Estate Board’s conference and trade show.
Immediately prior to a rescheduled inspection on May 19, Buchanan’s affidavit states iPro Realty Ltd. disclosed to RECO a $6.5-million shortfall in its real estate trust account and a further $3.5-million shortfall in its commission trust account.
Following this disclosure, Buchanan said RECO proceeded with inspections on May 21 and 22, which confirmed trust account shortfalls.
RECO did not alert the public to the results of its iPro investigation until mid-August when it announced the brokerage “illegally disbursed” $10.5 million from its deposit and commission trust accounts.
RECO hired Dentons Canada LLP on Aug. 25 to conduct a comprehensive audit of the iPro matter, including a review of the agreement its former registrar Joseph Richer made with Alves and Colucci.
Dentons hired MNP to conduct a forensic audit.
Alessandra Leggio Di Matteo, a certified anti-money laundering and forensic investigator with MNP, visited iPro’s Brampton office on Aug. 29, 30 and Sept. 2 to “collect, catalogue and preserve physical records,” including 75 boxes of financial documents and 10 terabytes of digital files.
“My preliminary analysis indicates that trust funds appear to have been used to make payments to Alves and Colucci and related parties,” Leggio Di Matteo wrote in her affidavit.
The forensic accountant’s “limited review” of iPro’s transactions from Jan. 1 to Aug. 22, 2025 is based on “bank statements, cheques, deposit slips, and limited supporting documents.”
Leggio Di Matteo’s affidavit noted that she would like to review documents from the period of Jan. 1, 2020 to Aug. 31, 2025 to “allow for a more complete analysis of the Trust Scheme,” and said such an analysis would require access to the accounting systems and other software used by the co-founders and their companies.
“A complete tracing of the trust funds cannot be completed until and unless further and full disclosure of banking documentation from (Colucci, Alves and iPro Realty) is provided and analyzed.”
The MNP audit also revealed that iPro Realty has two corporations — iPro Realty Ltd., which is registered with RECO, and iPro Realty Inc., which is not registered with the regulator. Both have trust accounts.
“I am advised by a representative of RECO and understand that iPro Realty Inc. is not now and was not ever a RECO registrant,” Leggio Di Matteo said in her affidavit. “It is therefore unclear why iPro Realty Inc. was operating trust accounts and holding trust funds.”
Alves and/or Colucci are named as directors on provincial business registration records for all companies that received money from either iPro Realty Ltd. or iPro Realty Inc.‘s trust accounts, including: iPro Realty Inc., IP Holding Realty Ltd. (formerly known as Sutton Group Professional Realty Inc.), Hippo Holdings Corporation, Sutton Group Professional Real Estate Services Inc., Alco Motors Ltd., and Alco Rent-A-Car Ltd. (formerly known as SOS Rent-A-Car).
Between Jan. 1 and Aug. 22, MNP’s preliminary review shows the spouses of iPro’s co-founders also received nearly $84,000 in total that was transferred out of trust accounts.
More than $1.8 million was removed from trust accounts between January and August to pay investors and lenders.
An unknown bank account called iPro Realty Pay gave more than $9.8 million to iPro Realty Ltd., iPro Realty Inc. and Hippo Holdings between January and August, the affidavit states.
These transactions “are concerning,” Leggio Di Matteo said in her affidavit, “because it appears that iPro Realty Ltd. or iPro Realty Inc. held additional bank accounts that are currently unknown, to make sizable deposits into accounts held by iPro Realty Inc. and Hippo. The full extent to which Trust Funds were commingled and transferred is therefore unknown and requires further documentation to ascertain.”
Buchanan, RECO’s CEO, warns the stakes of Monday’s court decision on the injunction are high, noting in her affidavit that the trust funds “belong to registrants and consumers in Ontario’s real estate industry.”
The risk of additional harm is also high, she stated.
“Given the nature of the Trust Scheme, I believe there is risk of assets being concealed and/or dissipated unless the Respondents are restrained and have their accounts frozen … irreparable harm could result to consumers and registrants if the injunction is not granted.”
