A Real Estate Council of Alberta (RECA) Appeal Panel recently affirmed a decision of the executive director and the importance and requirement to swear a truthful affidavit when applying to become an industry member or when renewing your authorization.

The executive director cancelled the licence of a mortgage broker industry member because, subsequent to issuing an initial licence, the executive director received information that, in the executive director’s opinion, established that the applicant provided false or misleading information as part of the application process. In addition, the industry member failed to cooperate and adequately respond to the executive director’s inquiries. The former industry member requested a review of this decision by an Appeal Panel. 

The concern of an Appeal Panel in its deliberations is that the process is fair, that the information upon which the allegations are made is true, and that the sanctions are justified. Ultimately, the Appeal Panel must be satisfied that the sanctions imposed by the executive director are fair and appropriate in the circumstances. 

The evidence before the Appeal Panel in this particular case was not in dispute. In November 2008, an individual made application to become a licensed mortgage broker associate in Alberta. It was his actions in making application to become licensed and subsequent attempts to cover up his actions that gave rise to the executive director cancelling his licence.

Specifically, the individual in question answered “no” to the six suitability questions on the application form. The form states “These questions apply to any and all situations and/or events preceding the date of this application. Please read each of the following questions carefully and answer truthfully:” Question #20 and #21 asks about commencement of proceedings or convictions for Criminal Code violations or other offences for which no pardon has been granted. Testimony of the former industry member during the appeal hearing established that he ought to have marked “yes” to Question #20 and Question #21.

In addition, the “Responsibilities” portion of the application form includes the provision that: “…I will immediately notify the executive director in writing of any changes in the information provided to the executive director in support of this licence application that occurs during the application process or after the licence has been issued.” The individual admitted that he either neglected to read these provisions, or read them and ignored them.

All RECA licensing and/or registration forms also include an “Affidavit” section. In this case, the now-former industry member admitting to signing the affidavit and solemnly swearing to have read and understood all questions and statements, and that all information on the application was true, as required by the affidavit, but he also indicated at the appeal hearing that he was not aware of what an affidavit was or its legal effect. The affidavit section also provides notification that: “Any affidavit containing false or misleading information may result in the refusal of the application or suspension or cancellation of any authorization issued thereupon.”

It is a best practice guideline for the broker and the person in front of whom the affidavit is sworn, to make inquiries of the applicant to ensure the information contained in the application is truthful and not false or misleading.

As part of the application process to become licensed as an industry member, the applicant was required to submit a Certified Criminal Record Check (CCRC) to RECA for review. He became licensed by RECA prior to RECA receiving his CCRC. In mid-April 2009, RECA’s registrar sent the individual a letter requesting that he provide a copy of his CCRC. This letter, as well as other communication from RECA, were ignored.

The individual in question received his CCRC from the Royal Canadian Mounted Police in early 2009, realized that his criminal record had not been expunged or pardoned, and delayed sending it to RECA until he was explicitly asked by RECA to do so – and even then, he resisted sending page two of the CCRC that gave the details of his criminal record. He admitted he waited for the deadline to deliver his CCRC to RECA because he did not take the process seriously enough and he testified he thought the sworn affidavit was a legal formality and did not understand why it was so important.

As stated earlier, the facts were not in dispute. As a professional person, the industry member ought to have known the importance of dealing honestly and directly with RECA as a governing body. If there was any doubt as to the veracity of his representations, he ought to have consulted with his broker and RECA. By swearing to false, misleading or questionable information on the RECA application form, he demonstrated carelessness, or negligence, or willful blindness without regard to the consequences. The application form contained several clear warnings that should have alerted him to the importance of his actions.

As soon as the industry member became aware that he had a criminal record, there was no reason for him to maintain his earlier belief that his criminal record had been expunged. His obligation as a professional was to clarify his status with the governing bodies of the profession or professions of which he was a member. Delay in doing so indicates, at the very least, disregard for these professional bodies. The Appeal Panel is not able to conclude that he intentionally intended to deceive anyone. However, he clearly did not do enough to avoid a reasonable person from coming to that conclusion.

The Appeal Panel found that the executive director’s decision to cancel the former industry member’s licence was justified and therefore reasonable in the circumstances of the case.

This individual will be eligible to re-apply for his licence in 36 months as per s.14 of the Real Estate Act Rules.

This case illustrates how important it is that individuals take the application process seriously and ensure they complete the application form truthfully and swear a truthful affidavit. Swearing a false affidavit is a criminal offence and doing so can result in a licence cancellation.

Read the complete Appeal Panel decision on RECA’s website under Complaints and Outcomes.

 

 

 

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