Unlicensed Practice – A Fine Line

RECA’s strategic planning survey — sent out to all industry members in February 2011 — showed that industry members had concerns about the perceived proliferation of unlicenced practice in Alberta.

RECA takes unlicensed (or unauthorized) activity complaints seriously.  A person cannot trade in real estate, deal in mortgages or act as a real estate appraiser without an authorization issued by RECA (s. 17 of the Real Estate Act).

Those acting without an authorization may be subject to investigation and potential sanction, and RECA may issue Administrative Penalties up to a maximum of $25,000 per contravention of s. 17 .

Administrative Penalties for unauthorized activity are posted in the discipline section of the RECA website.  Have a look at these examples of RECA Administrative Penalties for unauthorized activity.  In one of these cases, Administrative Penalties were in the cumulative amount of $25,000.

Instead of issuing an Administrative Penalty for unauthorized activity, the Real Estate Act also permits a prosecution by the Crown before the Courts for this illegal activity.  If convicted, the Court has the authority to order court fines and to return commissions earned while unlicensed.  Experience shows that Alberta Courts may not always sanction unlicensed activity severely.

In previous years, fines have been in the $100 range and education has also been ordered. Incarceration for unlicensed activity is not permitted under the Real Estate Act. Contrast this to Ontario, where jail time for unlicensed activity may happen.

In Alberta, when RECA receives complaints about unlicensed practice, Administrative Penalties have proven effective in deterring and stopping unlicenced activity once commenced.

What do you think about RECA’s enforcement of licensing requirements? 

Do you think Administrative Penalties should be severe in order to deter or stop unlicensed practice?