B.C. real estate firm fined $30K for using trust money to pay realtors
A B.C. real estate agency has been fined $30,000 for moving money from a trust account to pay its realtors.
The Victoria-based firm, Burr Properties Ltd, transferred almost $500,000 from its real estate trust account to an account used to pay realtors their commission, according to a June 6 B.C. Financial Services Authority decision.
"The payment of the Commissions caused a shortage in the brokerage's pooled rental trust account in the amount of $495,303.85 from July 31, 2020, to December 23, 2020," the decision read.
The account was finally brought up to date in February 2021.
The decision said the missing money was discovered when Burr Properties submitted its accountant's report filings.
Shortly afterwards the B.C. Financial Services Authority conducted an audit of the brokerage.
According to the decision, Burr Properties said it had lost its long-term bookkeeper who had been there for over twenty years and some realtors had complained of unpaid commissions.
The managing broker said the new bookkeeper was unable to locate the commissions but was confident there were adequate funds.
Following the audit, the Financial Services Authority put conditions on the managing broker and transferred the signing authority of trust and other accounts to two other staffers.
Burr Properties signed a consent order admitting to professional misconduct and that the trust account showed a negative balance for more than six months.
"The negative balance was not immediately eliminated and reported to B.C. Financial Service Authority contrary... to the rules," the decision read.
The Financial Service Authority fined the brokerage $30,000 plus $1,500 in enforcement expenses.
Burr Properties now has three months to pay the fine.
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