Report from Council Newsletter, August 2019

Often summertime is when many in BC choose to take time to relax and enjoy the great outdoors. But not at RECBC, where this summer has been filled with activity. We are busy preparing for the transition in regulatory education from BCREA to RECBC, revising mandatory consumer disclosure forms, and developing a new course on anti-money laundering, to name just a few initiatives currently underway. All of our work is in support of RECBC’s mission — to protect the public interest by promoting professional standards, enhancing competency, and regulating the conduct of licensed real estate professionals in BC.

Some of the initiatives we’re working on include:

Regulatory education transition

As announced in July, RECBC and BCREA are working together to bring the ongoing management of regulatory education to RECBC this fall. This means RECBC will take on the responsibility for managing registrations for Legal Update and Applied Practice Courses. Both organizations are working hard to ensure a smooth transition with minimal impact on registration processes and service levels. This transition marks a new era where RECBC is responsible for the design, development and delivery of all regulatory education for real estate professionals in BC. We will be working in partnership with real estate boards, UBC and course instructors to maintain the highest standards of regulatory education. Learn more about the planning of the transition in this issue of Report from Council.

Annual Service Plan Report

Reporting on our performance is one of the key ways we adhere to our mandate of protecting the public through regulation of the real estate industry. Our recently released annual service plan report outlines the actions we’ve taken to support the provincial government’s three key commitments to British Columbians: to make life more affordable, to deliver the services that people count on and to build a strong, sustainable economy.

Consumer disclosure forms update

Since mandatory disclosure forms were first introduced in June 2018, the feedback we’ve received is to make the forms more streamlined and easier to read. We’ve listened, and in response we’ve collaborated with the Office of the Superintendent of Real Estate to substantially revise the forms to be more accessible to all audiences. As part of the updates, we are developing a disclosure form specifically for rental property managers to use with prospective tenants. In addition to disclosing the agency duties of a rental property manager, the form includes links to other resources for consumers about tenant and landlord rights and responsibilities.

Anti-money laundering course in development

We are pleased to announce that we are developing a new mandatory course on anti-money laundering, with implementation timing to be advised in the fall of 2019. You can find more details on the course in this issue of Report from Council.

As we head into the fall season, RECBC will continue to keep you updated on the progress of our initiatives.

Finally, I wish to acknowledge the contributions of two Council members who recently resigned their positions: Elana Mignosa and Marianne Bond. Marianne was appointed in July 2018, while Elana has been a publicly appointed member of Council since 2015. For information about the appointment process for members of Council, please visit the website of the Crown Agencies and Board Resourcing Office.

As always, we welcome your feedback and comments on anything you read in this Report from Council. Send your thoughts to us at [email protected].

As announced in July 2019, RECBC and the British Columbia Real Estate Association (BCREA) have signed an agreement that will see the management of regulatory education for real estate professionals transition to RECBC on October 1, 2019. Through this agreement, RECBC will increase its oversight, control and direct involvement in the development and instruction of the Legal Update courses and Applied Practice Course, as outlined in the Raising Standards of Regulatory Education White Paper published in 2018. RECBC is committed to continuing to work in partnership with real estate boards, UBC and course instructors to ensure we maintain high standards for regulatory education.

Both RECBC and BCREA are focused on ensuring that the changeover is a smooth one for BC’s real estate professionals. The two organizations have worked closely for months to plan the transition and minimize potential disruption.

In fact, we are very pleased to tell you we will be welcoming key members of the Learner Support team from BCREA, who will be joining RECBC this fall, providing registration support, scheduling courses, and working with instructors.

Here’s what else you can expect beginning this October:

• All information on regulatory education courses will transfer from BCREA’s website to RECBC’s site, including course schedules and registration links.
• Registration processes will not change, as RECBC will continue to use the same registration system as previously.
• For answers to questions or support with registration after October 1, contact RECBC directly.
• In-class sessions will continue to be hosted in familiar locations, led by experienced and knowledgeable instructors.

Look for further details, including online links, registration support emails and phone numbers, coming in September.

RECBC is committed to ensuring the ongoing excellence of regulatory education.

Throughout August and September, please continue to visit the BCREA website to register for Legal Update or Applied Practice courses.

If you have any questions, please contact [email protected].

As part of RECBC’s ongoing commitment to address risks associated with money laundering, Council members recently approved the development of a new mandatory regulatory education course: an anti-money laundering course that will be introduced in the coming months.

Money laundering is a serious issue that impacts all British Columbians across our province. The recent report from the Expert Panel on Money Laundering in BC Real Estate led by Professor Maureen Maloney has revealed the impact that money laundering activities have had on the provincial economy, as well as identified the risks of real estate licensees being exploited by money launderers. To help ensure the safety of BC real estate markets, earlier this year RECBC partnered with the Financial Transactions and Reports Analysis Centre of Canada (FINTRAC), through a memorandum of understanding, to strengthen compliance, increase reporting of suspicious transactions and reduce the risk of criminal activity in the real estate sector. Now, with the introduction of mandatory anti-money laundering education, RECBC is taking further steps to ensure that real estate professionals understand the important role they play as agents to know their client and assess risk so that they do not assist those seeking to launder money.

The mandatory course will be delivered online and in a self-paced format, allowing learners the flexibility to access course content at the time and place most convenient for them. The curriculum, developed by experts in the field, will begin with a review of the basics — defining money laundering, how it happens and its socioeconomic impacts and risks to society. The course will introduce “know your client” methods for real estate professionals to establish their customers’ identity, understand the nature of their customers’ activities and assess money laundering risks associated with the customer. It will also cover the requirements for real estate professionals under the FINTRAC compliance regime.

By raising the level of knowledge and awareness of the risks of money laundering among real estate professionals, RECBC’s aim is to ensure that the public can have full confidence that real estate professionals understand their role in preventing proceeds of crime from entering BC’s real estate markets. Introducing mandatory education for real estate professionals on anti-money laundering was one of five recommendations put forward in the spring of 2019 by the British Columbia Real Estate Association, the Appraisal Institute of Canada — BC Association, BC Notaries Association, Canadian Mortgage Brokers Association — British Columbia, and the Real Estate Board of Greater Vancouver.

We will provide updates as development continues on the new anti-money laundering course, stay tuned!

If you’ve recently accessed RECBC’s licensee portal to renew your licence, or used the licensee search tool to look up details of your licence, you may have noticed the web interface has changed. We’ve redesigned these elements, adding new functionality to deliver an improved user experience.

Here’s a quick review of what’s new:

Clearer, easy to use search tool. Updates to the licensee search page simplify searching for a licensee or a brokerage. Find brokerages by city or search by licensee number to access your profile quickly.

Resolve issues quickly by chatting with a technical representative online. If you need help accessing or using the Licensee Portal, take advantage of the handy chat feature on the portal page. This feature is available during business hours. Click on the chat icon and it will link you directly to a RECBC technical representative who will respond to your query. Technical representative OJ Olegario responds to chat requests, his photo appears next to the chat icon.

Reset your password by using the Forgot Your Password link. The new Forgot Your Password link in the Licensee Portal now enables you to reset your password using your registered email address with RECBC. Simply click on the link, enter your email address and an email will be sent to you with the password reset instructions. If the system cannot find your email address, it is possible that you may need to activate your account first in the Licensee Portal using the “Activate your account” green button.

Is the date for the renewal of your licence approaching? Make sure you’ve planned well in advance to complete all required relicensing education. For trading services licensees and rental property management services licensees, that means ensuring you’ve completed both a Legal Update course and the Rule Changes: Agency and Disclosure course. Strata management licensees must complete a Legal Update course.

Course offerings book up well in advance, so register early to be sure that you have sufficient time to complete these courses ahead of your licence renewal date. After completing each course, keep your course completion records in a safe place and submit them to RECBC along with your renewal application.

You will receive relicensing education reminders from RECBC ahead of your licence expiry date. Use the links in the email to register, or visit our Relicensing Education Program page to find information on registration, along with helpful FAQs.

If you have any questions about license renewals, please contact [email protected].

/wp-content/uploads/RECBC-Complaints-Aug19.png We’ve developed a new guide to help real estate professionals understand the procedures and policies for consent orders, consent order proposals and the proceedings of RECBC’s Consent Order Review Committee.

RECBC has authority under the Real Estate Services Act to investigate the conduct and competence of licensed real estate professionals, and to discipline those who are found to have committed misconduct. A real estate professional who has received a notice of hearing has the right to submit a written proposal to RECBC consenting to a discipline committee making an order without conducting a hearing in the matter. Many real estate professionals choose to settle disciplinary matters through a consent order and avoid the considerable time and expense of a hearing.

In our continued commitment to increase transparency, we have developed A Guide to RECBC’s Consent Order Process to ensure that real estate professionals have a full understanding of the consent order process, from start to finish.

The guide covers:

• terminology (e.g. consent order (CO), consent order proposal (COP), Consent Order Review Committee (CORC), etc.);
• how to prepare for a CORC session;
• what to expect at the session; and
• what will happen afterwards.

We have also developed an infographic that explains how complaints are handled, click on the image above to see a larger view.

As a crown agency, RECBC takes an open and transparent approach to communications. We publish a number of reports each year to keep the public and real estate professionals informed of our goals and objectives, our progress in meeting our targets and our operational activities. You can find these reports on our website.

Newly published reports this summer include:

RECBC’s 2019 Service Plan Report

RECBC’s Quarterly Statistics Reporting — Find the numbers on complaints, discipline, audits and more for April to June 2019.

Did you know RECBC has official social media accounts on Facebook, Twitter, and LinkedIn? Make sure you follow us to keep up to date on the latest news and developments at RECBC.

Social media presents us with the opportunity to engage directly with consumers and real estate professionals as well as provide information about our services, initiatives and work. Our activity on social media helps us build awareness of RECBC as a trusted regulatory authority and ensures that consumers and real estate professionals have the information they need to participate effectively in real estate transactions. RECBC’s social media channels will deliver consistent and up to date information to help create awareness and build engagement across all platforms.

Give us a like and follow us now to keep up with the latest news!

Each issue of Report from Council is designed to bring you news and updates on regulatory matters that impact your professional life as a BC real estate licensee. We want it to be informative, engaging and useful. So we’d like to hear from you. To ensure we are keeping pace with your needs, we want your opinions. We will use your feedback to help us make Report from Council a relevant, timely and impactful publication. We’ll report back on the survey results in a future edition and our plans for Report from Council moving forward.

Take the readership survey today!

If you have any questions about the survey, please contact [email protected].

Drones — or remotely piloted aircraft (RPA) — are becoming increasingly popular in a number of industries, ranging from fire services to international aid organizations and delivery companies. Real estate professionals are also using drones to capture panoramic images which give potential buyers better views of a property.However, using drones to photograph properties can risk violating aviation regulations and may be infringing on the privacy rights of neighbouring property owners. Before you launch that drone, ensure you’re staying within the law and the new Transport Canada rules effective June 1, 2019.

Transport Canada Regulations

According to Transport Canada, drone pilots must follow the rules under the Canadian Aviation Regulations that apply to remotely piloted aircraft systems.

The new rules include drone registration and the requirement for operators to have a drone pilot certificate for drones weighing between 250 grams (about half a pound) and 25 kilograms (about 55 pounds). The weight of your drone, distance from bystanders and airspace rules define your category. Drones that are under 250 grams do not require registration or a pilot certificate.

Many locations throughout BC require advanced operations because of controlled airspace as shown in the airspace image below. There are many restricted or controlled airspaces throughout the province as the map shows. Drones may fly in these areas but only with an advanced license and with permission.

Operators who fly drones for business purposes without permission risk penalties from Transport Canada including fines of up to $3,000 for an individual and $15,000 for a business. If you break more than one rule, you could receive multiple penalties. Real estate professionals are reminded that they must promptly notify RECBC in writing if they are charged with (or convicted of) an offence under a federal or provincial enactment or under a foreign law, as per section 2-21(2)(d) of the Real Estate Rules. A real estate professional found to have violated Transport Canada regulations is subject to investigation, which may result in disciplinary action by RECBC.

Privacy and Trespassing Risks

Drones equipped with cameras could be breaching privacy rights of neighbouring property owners. Real estate professionals operating drones must be aware that under BC’s Privacy Act, individuals have the right to sue others for violating their privacy without permission. Under Transport Canada regulations, drone operators must respect laws regarding privacy and trespassing. It is recommended that you inform neighbouring property owners and seek their permission before photographing listings from the air.

Potential for Property Damage

Drones may cause property damage if used irresponsibly. After an unauthorized drone grounded water bombers and firefighting crews in southern BC for several hours during the summer of 2015, the BC Wildfire Service prohibited the use of drones within five miles of a forest fire. Violators can face fines of up to $100,000 and/or one year in jail.

Explore the option of consulting a professional drone service or attending a drone flight school.

More Information:

• FAQs on Operating in Controlled Airspace
• Interactive Drone Site Selection Map

Following the publication earlier this year of a disciplinary order against a BC licensee for sitting on a strata council without having made the required disclosures, we’ve heard from licensees with questions about the requirement. This month’s You Asked Us column looks at why disclosure is required and how to ensure you’re complying with the rules for strata council membership.

Q: I’d like to put my name forward to be elected to sit on the strata council in the building where I own a unit. Do I need to disclose that I am a licensed real estate professional?

Yes, as a licensed real estate professional you have disclosure requirements in this situation.

Whether you are licensed for trading services, rental property management or strata management services, you will need to make a disclosure to the strata corporation before you begin sitting on the strata council, and you will need to provide a copy of the disclosure to your managing broker. RECBC has developed a form that you can use to make this disclosure, called the Disclosure of Management of Strata Corporation by Licensee Who Is an Owner. The form is available for download from the RECBC website and on WEBForms.

When you have made the disclosure, you may provide volunteer strata management services to the strata corporation (as a strata council member or otherwise), under the following conditions:

• You may provide strata management services to a maximum of two strata corporations in which you own a strata lot.
• You must not have sole signing authority for withdrawals of any funds of the strata corporation and may not otherwise have sole authority for expenditures of any funds of the strata corporation.
• You must not receive and not expect to receive any remuneration for the strata management services provided to the strata corporation.
• On receipt of any strata fees, contributions, levies or other amounts levied by or due to the strata corporation under the Strata Property Act, you must promptly deliver the money to the strata corporation.

Why disclosure is required

The Real Estate Services Act considers sitting on a strata council to be a strata management service. As a real estate professional, you can only provide real estate services through your brokerage, and you can only provide the real estate services for which you are licensed. (See section 2 of RESA, and the definition of Strata Management Services).

To allow real estate professionals to sit on strata councils or provide other volunteer services to strata corporations where they are owners, RECBC created a rule that provides an exemption from the Real Estate Services Act. Section 9-3 of the Rules permits a licensee who is a strata lot owner and therefore is a member of a strata corporation, who wishes to become a strata council member, or to otherwise provide strata management services to that strata corporation in a volunteer capacity, to do so without the Real Estate Services Act applying to them in relation to these services.

Re-election and disclosure

After your term on the strata council, if you wish to be re-elected, you should make a new disclosure and provide the copy of that disclosure to your managing broker. And of course, continue to observe all the requirements of section 9-3 of the Rules. If in doubt — disclose!

Consequences of failing to disclose

RECBC may take disciplinary action against a licensee who fails to promptly deliver strata corporation funds to the strata corporation, or who fails to make the required disclosures.

More information:

• Professional Standards Manual — Strata Management Services
• Real Estate Rules — Section 9-3
• Disclosure of Management of Strata Corporation by Licensee Who Is an Owner Form

The following actions have been taken as a result of disciplinary hearings and Consent Orders conducted by RECBC.

Trading Services (Sales)

• Inderpal Singh Gill, Representative, Century 21 Coastal Realty Ltd., Surrey
• Keith Setter, Representative, RE/MAX Treeland Realty, Langley, Pamela Raye Stadnik, Representative, RE/MAX Treeland Realty, Langley
• Neil Albert Barnes, Representative, Sutton Group-West Coast Realty, Vancouver Broadway, Vancouver
• Meaghan Halena Westie, Representative, RE/MAX Powell River, Powell River
• Nadine Mary Westgate, Managing Broker, Sage Executive Group Real Estate, Kelowna
• Sunveer (Sunny) Ball, Representative, Sutton Group — West Coast Realty, Surrey
• NOTICE OF PERMANENT SURRENDER OF LICENCE: Grace Tin-Lan Szeto

Rental Property Management Services

• Oakwyn Property Management Ltd., Oakwyn Property Management Ltd., Vancouver and Arlene Christina Chiang, Oakwyn Property Management Ltd., Vancouver

Is Your Brokerage a Target for Fraudsters?

Brokerages need to be aware of the risk of online “social engineering” fraud and to take steps to mitigate the risks. The Law Society of BC recently issued a fraud alert to BC law firms, warning of an emerging pattern of social engineering frauds targeting trust accounts. Real estate brokerages that hold funds in trust should also be aware and vigilant against frauds.

What is Social Engineering Fraud?

If a fraudster tricks you into willingly paying funds out of trust through the intentional misrepresentation of some material fact, you’ve fallen victim to a “social engineering” fraud. They often involve fraudsters pretending to be an existing client or someone authorized to give instructions on the client’s behalf.

How does it work?

Fraudsters may hack into the email account of a party to a real estate transaction, acquiring enough information to allow them to assume that individual’s identity. Once deposit funds have been placed in the brokerage trust account, the fraudster emails the brokerage with directions to redirect the funds to a different account. There are many variations on this theme, and all may result in missing funds.

How can you protect your brokerage from fraud?

Establishing brokerage protocols and educating staff and licensees to follow those protocols is one of the most effective means of ensuring you do not fall prey to fraudsters. Putting effective security measures in place to protect electronic records and detect security breaches is another important step. For more information on protecting your business, and consumer funds entrusted to you, from risk of fraud, see the Competition Bureau Canada.

Planning a Vacation? Scams can happen during holidays! Remember to arrange to delegate your responsibilities to a competent licensee at your brokerage (a managing broker or associate broker is recommended) while you are away. For more information about delegation, see the Brokerage Standards Manual.

If you suspect that your brokerage or clients have been targeted for fraud, contact a Professional Standards Advisor at RECBC: [email protected].