Real Estate Council of Ontario (RECO) was successful in obtaining several court orders in a hearing Monday, which freeze the assets of iPro Realty’s Ltd.’s founders, and give Fedele Colucci and Rui Alves one day to tally up their anticipated living expenses and legal costs.
Justice William Black of the Ontario Superior Court of Justice heard the matter virtually. RECO is pursuing iPro for removing and misusing consumer deposits and agent commissions held in trust.
RECO said in its original court application that it is seeking to trace the flow of trust funds that were diverted and return them to the trust accounts from which they were taken.
iPro’s 17 offices shut down on Aug. 19, affecting 2,400 agents, following the discovery of $10.5 million missing from the brokerage’s trust accounts. The total amount missing is now closer to $6.5 million, since the brokerage’s assets were sold to iCloud Realty for $3 million.
Justice Black’s orders specifically include a Mareva injunction, or a freezing order, which prevents the respondents from moving assets before the case is resolved.
Under a separate order, iPro’s former principals may apply for an order specifying the amount of funds they are entitled to spend on “ordinary living expenses, and legal advice and representation.”
Norwich Relief was also ordered, which compels banks to deliver to RECO any and all records pertaining to the respondents’ assets and accounts.
The list of respondents includes companies that either Colucci, Alves, or both are directors of, including: IP Holding Realty Ltd., Hippo Holdings Corporation, Sutton Group Professional Real Estate Services Inc., Alco Motors Ltd., and Alco Rent-A-Car Ltd.
In total, roughly $30 million of funds that should have been held in trust were instead commingled with the firm’s general account or sent elsewhere, according to court filings.
For more details, find court documents related to the matter here.
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.
What I can surmise after reading through the documents is good luck recovering any substantial funds from Messrs. Colucci and Alves or any of their shell companies.
Affidavits indicate that there are little to no assets in their names that aren’t already heavily encumbered by secured creditors.
Declaring bankruptcy is next and secured creditors will pick over the carcass before the public sees a dime returned to the affected Trust Accounts.
I also note that both Alves and Colucci have hired prominent criminal defense lawyers.
This is fraud. Not sure what the OPP are waiting for.
As an aside I look forward to the interim report from Dentons LLP regarding the egregious conduct of RECO, the former Registrar and the Board of Directors in this matter.
RECO has opened itself up to a contributory negligence claim in this matter. Their incompetence in the handling of this scandal is egregious. OREA and or CREA should be examining their legal options to recover any commission shortfalls as a result of RECO”s actions or inactions on behalf in realtors.
There has been no real explanation regarding the circumstances surrounding the dismissal of the former registrar Joseph Richer. What were the terms of dismissal? Realtors and the general public have the right to know.
Furthermore the public is entitled to know the content and nature of the agreement between RECO and the principals of iPro whereby the perpetrators of this fraud were permitted to walk away legally unscathed.
It’s surprising — and frankly very suspicious — that while iPro was collapsing, there was just enough time to shut it down and seamlessly transfer agents into another brokerage called iCloud Realty. Suddenly, we’re told iCloud paid $3 million to assume iPro’s offices and agents. And RECO approved this deal. The obvious question: Who really owns iCloud? Do Rui, Fidel, or their families hold any interest in it? If so, this entire process reeks of a back-door bailout and asset laundering under the guise of a legitimate sale.
Freezing assets at this stage feels like locking the barn door after the horses are gone. If Rui and Fidel knew iPro was collapsing — and the evidence suggests they did — then what makes anyone believe there’s meaningful money left to recover? Funds like this don’t just sit idle; they’re often moved offshore, layered through different accounts, or shifted under other people’s names long before regulators act. Tracing and clawing back those assets will be next to impossible. Any judgments or garnishments are likely to be symbolic at best — you can’t get blood from a stone.
The bigger failure here lies squarely with RECO. They should have seen the warning signs long ago and never allowed iPro to drift into this mess unattended. This disaster was not sudden; it was systemic neglect. And the most alarming part is structural: RECO is overseen by brokerage owners themselves. The current Chair, Katie Steinfeld, is a broker-owner. Sylvia Kirkwood is another broker on the board. And here’s the kicker: Rui Alves himself once sat on RECO’s board — so he knew exactly how their processes worked and where the gaps were. How can the public have confidence when the very people being investigated once held insider positions at the regulator? That’s like letting the wolves guard the sheep. The conflict of interest is undeniable, and the public pays the price.
Until governance changes and accountability is real, these “freezes” will only be theatre. Consumers deserve better than oversight bodies that enable suspicious transfers, rubber-stamp deals, and react only after the damage is done.