The Ontario government has formally warned the Real Estate Council of Ontario (RECO) that it may assume control of the regulator if substantial governance and operational issues identified in a recent audit are not addressed within 15 days.
RECO, which oversees licensing, compliance and enforcement for more than 110,000 real estate professionals in the province, has faced mounting scrutiny following an external review commissioned earlier this year.
The independent audit examined RECO’s internal procedures, decision-making processes and its handling of recent regulatory matters. The findings pointed to significant deficiencies and raised concerns about the organization’s effectiveness in protecting the public interest.
In a letter sent to RECO’s board, the Ministry of Public and Business Service Delivery and Procurement stated that confidence in the regulator has deteriorated within the industry and that, without corrective action, the current situation could lead to “serious harm to the public.”
The province said it is prepared to appoint an administrator or take direct control of RECO’s operations if the regulator does not provide a satisfactory plan to correct the issues identified.
The move represents one of the strongest interventions the province has signalled toward a self-regulatory body in recent years.
RECO confirmed it has received the audit and said it is reviewing the recommendations.
The government has not detailed what steps it will take if it proceeds with a takeover, but officials indicated they expect a full response from the regulator within the two-week deadline.
