Legislation and Regulation: The Rules That Govern the File
The regulatory frame
Mortgage brokerage in Alberta operates under provincial legislation and the rules of the regulator, alongside federal requirements. Candidates should be able to name the categories of obligation and explain why each exists: licensing, conduct, disclosure, anti-money laundering, and privacy.
Concepts you must understand
- Licensing: individuals and brokerages must be licensed, and activities outside the licence - or acting while unlicensed - are prohibited.
- Supervision and designated roles: a brokerage has a designated individual responsible for supervising licensees and the brokerage's records.
- Disclosure obligations: conflicts of interest, compensation from lenders, and the cost of borrowing must be disclosed to borrowers.
- Anti-money-laundering and terrorist financing: identity verification, recordkeeping, and reporting of suspicious transactions are mandatory.
- Privacy: personal information may be collected, used, and disclosed only with appropriate consent and for identified purposes.
- Advertising and representation: marketing must be accurate and must not mislead about rates, approvals, or affiliation.
- Complaints and discipline: the regulator can investigate and impose penalties; cooperation is required.
Traps that appear in questions
- Assuming federal rules replace provincial ones. They stack; both apply.
- Treating disclosure as a one-time event. It is ongoing when circumstances change.
- Skipping identity verification for existing clients. Verification is required, not optional.
- Believing a lender's approval cures a licensing problem. It does not.
Rule of thumb
When a question describes a shortcut that saves time but removes a record or a disclosure, the compliant answer is the one that preserves the record and the disclosure. Worked example: a borrower asks you to submit an application before signing the service agreement to "hold a rate." The correct approach is to complete the required documentation first; rate holds do not suspend licensing and disclosure requirements.