REAL ESTATE PROFESSIONALS ARE POISED TO COMPLY WITH NEW RULES AND REGS.
A transaction is an Agreement of Purchase and Sale. An attempted transaction is an offer. Therefore, as a Professional Realtor, you need to complete this form by the offer stage regardless of whether or not your offer becomes a deal. You need to see a valid original piece of government issued ID. A photocopy or a scanned version is not sufficient. You must personally see the original document. Valid ID would be a current driver’s license, a current passport, a record of landing (landed immigrants), a permanent residence card, old age security card, a certificate of Indian status or a Social Insurance Number card (if you are using a SIN card for ID, do not record the SIN number). You cannot use an OHIP card for ID (illegal in Ontario to use OHIP card for any purpose other than medical). Complete the document fully. Some documents will not have an expiry date (i.e. a SIN card or birth certificate) so this section would be “N/A” in these circumstances. Passports, driver’s licenses, etc. do have expiry dates so ensure you record this information in these circumstances and also double check to ensure the document is currently valid (not expired). If you are dealing with an estate or a power of attorney, complete the form for the individuals signing the offer or agreement. You do not need to complete the form for the beneficiaries of the estate or the principal who gave the power of attorney at this time (this requirement may change). Buyers and Deposits If you are representing the Buyer(s) as either clients or customers and they are giving a deposit with respect to an offer or an Agreement of Purchase and Sale, you must complete a “Receipt of Funds Record”. You keep this form and turn it in with your other paperwork. Every time you receive a deposit from a buyer you represent as a client or as a customer you complete this form. Therefore, if you receive an initial deposit and then a subsequent deposit, you will complete two forms. You do not give this form to the listing brokerage when you pass over the deposit. Complete the Receipt of Funds Record fully. However, for Section 3, do the following: * Number of Account: Unknown - Accounting Department to verify if possible * Type of Account: Trust Account * Name of account holder: (insert name of listing brokerage) Since it is your obligation to complete this form when you are representing buyers, you cannot have your buyers drop off the cheque at the listing office (unless the listing office is your office, of course). When you are dealing with a client you cannot personally see (out of city/province, foreign clients, etc.), you cannot personally view their ID. Therefore, you must contract with someone (called a “mandatary”) where the client is to verify the ID on your behalf. In many cases you may choose a salesperson in the jurisdiction where the client is to do this. Alternatively, you may have to have it done by a solicitor or a notary, etc. In some circumstances, you may need your client to put you in touch with an individual who can provide this service. In some circumstances, you will have to pay the mandatary. Regardless, you must have a written agreement that the mandatary will perform this service for you. CREA is drafting a sample agreement and we will forward it to you when it becomes available. In the interim, please speak to your manager before doing a transaction with non-present clients. It does not matter if the client is known to you (she could be your mother, for example). If the client is not present, a mandatary must complete the form on your behalf. If you have clients you know will be leaving town for any reason (move, vacation, business, etc.), it would be advisable to complete the form when you have the opportunity and not wait for an offer. Corporations If your client is a corporation, you have thirty days from the date of the transaction to complete the “Corporation/Other Entity Client Information Record”. Other entities would be partnerships, associations, churches, etc. In most circumstances, you will likely get the required information from the corporation’s solicitor. If neither the solicitor nor the client can provide you with the information, you may have to pay to have a corporations search done. Suspicious Transactions You must always report suspicious transactions or attempted transactions. For example, you attend for a listing presentation and believe, from your experience and the condition of the property, that the property may have been a grow house. If you have questions about a real situation, please speak to your manager. Regardless of whether or not you are suspicious, if you receive a cash deposit or cash deposits that exceed $10,000 in cash (that is, you are receiving currency, not a cheque, etc.), this transaction must be reported. In either case, you must not advise the individual that you will be making a report. Uncooperative Clients/ Customers If you are dealing with someone who refuses to provide you with ID, such as a FSBO seller, you can still proceed with the transaction. However, you must proceed with caution. You are required to make reasonable attempts to ID the individual and you must record the attempts you made and that the individual refused. You must also now consider if the circumstances are suspicious. Privacy Law These new FINTRAC requirements do not eliminate our Privacy Policy or our obligations under PIPEDA (the privacy law statute). Essentially, we are required to keep the information secure and confidential, we are permitted to use it only for the stated purpose and we must destroy the information when we no longer have a legal purpose for retaining it. Therefore, if you record buyers or sellers ID information at the time of signing a listing or buyer representation agreement and no offer is ever received or submitted, the ID information should be destroyed when holdover period for the listing or buyer agreement has expired. We are required to keep our records for 5 years to comply with FINTRAC. Please submit your original document with your other deal paperwork (if you have an offer but no deal occurs, you must submit it as an attempted transaction). View the information online through REALTORlink. There is a fair amount of confusion surrounding the application of FINTRAC, even amongst CREA and OREA. More information to follow.
Information provided by Royal Lepage Realty
Comments (0)