British Columbia

New rules coming for mortgage brokers following B.C.'s money laundering probe

B.C. is amending the Mortgage Brokers Act for consumer protection, addressing issues pointed out by the Cullen Commission.

One pending change is increasing the maximum fine to $500,000 for brokers who violate the rules

A real estate sign that reads 'SOLD OVER ASKING' just atop a sign that reads 'FOR SALE'.
The B.C. government is introducing amendments to the Mortgage Brokers Act to help protect consumers. (Ben Nelms/CBC)

The British Columbia government is bringing in new laws to replace the outdated Mortgage Brokers Act as it follows recommendations from an inquiry into money laundering.

Finance Minister Selina Robinson introduced the bill in the legislature on Tuesday, saying B.C. residents deserve better consumer protection and more transparency in the mortgage broking industry.

The government says in a statement the new act will give the B.C. Financial Services Authority the ability to make rules for the industry, as non-traditional lenders emerge and more people turn to brokers and online technology to arrange residential mortgages.

It says that the act will provide a framework to address issues singled out by the Cullen Commission of Inquiry into Money Laundering that wrapped up in May, aimed at reducing the problem in the real estate sector.

One pending change is increasing fines to a maximum of $500,000 for those caught breaking the rules, while those with more than one conviction could face fines of up to $2.5 million.

According to the statement, the earliest the new rules could be introduced is estimated to be in late 2023.

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