Legislation, regulation and ethical obligations
This domain tests the statute and regulation behind Ontario trading, and the conduct standards RECO enforces. Questions cluster around TRESA, the Code of Ethics, conflict-of-interest disclosure, confidentiality, anti-money-laundering duties and the discipline process.
The statute and the regulator
The Trust in Real Estate Services Act, 2002 (TRESA) replaced REBBA 2002 on December 1, 2023 and is administered by the Real Estate Council of Ontario. TRESA governs registration, trading, trust money, advertising, records and discipline; the Code of Ethics, carried forward from the REBBA era, sets the conduct standard: fairness, honesty and integrity; service; competence; disclosure of conflict of interest; confidentiality; and no misrepresentation.
Core ethical duties
- Act in the client's best interest while never misleading another party to the trade.
- Disclose conflicts of interest, any interest you or a related person holds in the property, and your remuneration - in writing and early.
- Protect confidential information indefinitely, not only during the term of the agreement.
- Do not reveal the substance of a competing offer unless the seller has instructed disclosure in writing under TRESA.
- Cooperate fully with RECO; obstructing or ignoring a request is itself misconduct.
Anti-money-laundering and human rights
Brokerages are FINTRAC reporting entities: verify client identity, keep the prescribed records, and report suspicious transactions and large cash transactions of $10,000 or more. Ontario's Human Rights Code prohibits discriminatory terms, advertising and steering in housing.
Discipline
A complaint is reviewed by RECO and may be referred to the Discipline Committee, which can fine, suspend or revoke. Registration and discipline appeals go to the Licence Appeal Tribunal.
Worked example
A salesperson's cousin wants to buy a listing the salesperson holds. The registrant must disclose the relationship and the interest in writing to the seller client before any offer is presented, and the seller must consent; the brokerage should also consider whether designated representation is workable. Staying silent is a Code breach even if the eventual price is fair.
Traps
- Treating the Code of Ethics as guidance rather than a regulation with consequences.
- Revealing offer contents to another buyer "to be helpful".
- Assuming a complaint only matters if the client complains - RECO can act on its own motion.