Brokers of Record: The Buck Stops With Them

American president Harry S. Truman had a desk sign, measuring 2½” x 13”, that read “The buck stops here,” which meant responsibility and accountability ultimately rested with the president. In real estate, the buck stops with the broker of record.

All brokerages in Ontario must designate a broker of record, an individual who, above all, ensures that the brokerage and its employees (brokers, salespeople, other persons) comply with the Real Estate and Business Brokers Act, 2002, and Regulations (collectively known as REBBA 2002), and standards are maintained.

If the brokerage is a sole proprietorship, the sole proprietor must be the broker of record. If the brokerage is a partnership or a corporation, the broker of record is designated by partnership or corporate resolution, respectively. For corporations, the board of directors makes the resolution, and it is signed by the officers with the appropriate signing authority. A copy the resolution must be sent to the RECO registrar.

Partnership and corporation brokerages can also designate an “alternate broker of record” (i.e., another broker as an alternate signing authority to review and sign off on trust and trade transactions when the broker of record is unable to act). Again, this is done via partnership or corporate resolution. The alternate must be approved by the registrar.

Duties of the Broker of Record

•  Ensures the brokerage fully complies with REBBA 2002

•  Actively participates in the management of the brokerage

•  Ensures an adequate level of supervision for brokers, salespeople, and other brokerage employees

•  Takes reasonable steps to address failure to comply with REBBA 2002 by all brokerage employees

•  Reviews and signs monthly trust account reconciliations and trade record sheets

•  Signs brokerage financial statements, as required by the RECO registrar

Duties of the Alternate Signing Authority

The alternate signing authority must review and sign off on the following transactions only during that time when the broker of record is absent or unable to act:

•  trust account transactions

•  monthly trust account reconciliations

•  trade record sheets

 

Reference:

Ontario Real Estate Association and Acronamic Learning Systems Inc. (2015). Real estate broker course. Don Mills, ON: MediaLinx Printing Group.

 

 

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Brokers of Record: The Buck Stops With Them