Joseph Richer, long-time registrar at the Real Estate Council of Ontario (RECO), has exited the organization after the regulator’s handling of the iPro Realty trust account scandal drew widespread criticism.

Brenda Buchanan, the regulator’s CEO, indicated that she sought Richer’s removal in wake of his decision not to seek further disciplinary action after RECO shut the brokerage down recently.

“With the support of RECO’s board of directors, I have acted and effective August 22, Mr. Joseph Richer, the Registrar appointed under the Trust in Real Estate Services Act, 2002, has left RECO,” said Buchanan, the regulator’s CEO, in a statement.

Richer approved an agreement that spared iPro’s co-founders charges or fines, despite findings that approximately $10.5 million had been misappropriated from consumer deposit and commission trust accounts, The Toronto Star reported. During the three months after the shortfall was uncovered, iPro and its 2,400 agents completed nearly 730 transactions worth more than $700 million across the Greater Toronto Area, states the Star’s report, citing data based on the media outlet’s own research.

The decision to allow iPro to continue operating has sparked calls for accountability at the regulator. Industry observers argue that Richer could not have acted alone in permitting transactions to proceed under such circumstances.

Following the investigation, iPro’s co-founders voluntarily terminated their registrations, and RECO ordered the closure of the brokerage and its 17 offices on Aug. 19. A newly formed brokerage, iCloud, has absorbed some of iPro’s agents and clients.

RECO has since confirmed that approximately $3 million has been repaid, reducing the shortfall to less than $8 million.

The regulator told the Star that iPro co-founders Rui Alves and Fedele Colucci will not be charge in relation to the shortfall. Alves and Colucci have signed undertakings whereby they accepted iPro’s closure and agreed to terminate their RECO broker registrations and never reapply for registration again.

In notices about iPro, Alves and Colucci agreeing to terminate their registrations, RECO said the brokerage illegally disbursed funds from the brokerage’s consumer deposit and commission trust accounts, in contravention of the Trust in Real Estate Services Act.

Consumers and agents with funds tied to iPro transactions have been directed to pursue insurance claims.

Pictured: Joseph Richer, former registrar of RECO.

Photo: RECO