British Columbia Financial Services Authority has issued a $15,000 administrative penalty against Realtor Pardeep Singh Sandhu after he lent money to clients in a transaction that regulators say created a clear conflict of interest.
Sandhu was found to have made three violations of the Real Estate Services Rules stemming from an October 2021 property deal in Abbotsford.
Realtor gave personal loan to clients
According to the BCFSA notice issued Mar. 31, Sandhu provided a personal loan of $55,000 to his buyer clients to help complete the purchase, an act regulators said positioned him to inappropriately benefit from the deal financially.
“(Sandhu) obtained commission from the subject transaction, and the loan (he) gave changed both the nature and degree of (his) interest in ensuring that the transaction would complete,” reads the decision.
The authority said Sandhu failed to take adequate steps to avoid the conflict, did not promptly disclose the conflict to the clients so that they could obtain a mortgage for the transaction, and neglected to advise them to seek independent professional advice.
Next steps
Each of the three infractions carries a $5,000 penalty, for a total fine of $15,000.
Sandhu has 30 days to apply for a reconsideration of the decision.
If no request is submitted, the penalties will be deemed accepted.
Courtney Zwicker is a digital reporter and associate editor for REM. Based in Atlantic Canada, she has over a decade of experience covering daily business news.
I’m assuming it was the 10 % down or a portion of the down payment, undisclosed to the lender etc so the borrower fibbed, the realtor registered a second after closing to avoid detection (high risk second) if CMHC insured then they can deny insurance, the lender can then call in their first and everybody loses. But if they all stay calm and hopefully inflation takes care of (prices rise) they can all get out reasonably safe in time. But it’s gonna be a huge mess. Lender(s) sue for losses, owners defend saying they got scammed, realtor losses his $55 K plus legal fees etc etc lawyers will have a hay day here. So so damaging in the end.
Realtor should have to forfeit the $55 K and CMHC keep the insurance in place and everybody should be happy. Borrower gets a slap on the wrist for lying to the lender and that’s it.
Realtor loses it all … borrowers keep home, lender is happy etc
Interference with the integrity of a transaction in Real Estate is FRAUD
Simple!
Did the mortgage agent /lender not track the financing in the first place? How did it come come to light after the fact? Was this a family / friend deal or general public client?