Data from SingleKey shows that around 15 per cent of tenant applications contain falsified documents, a climbing figure as renters struggle with affordability and job insecurity. For Realtors, it’s a business risk that can leave clients and agents facing unpaid rent, legal costs, and property damage that can total tens of thousands of dollars.

Why are rental scams on the rise

Fraudulent documents from fake credit reports, to proof of income, and even fake driver’s licences are common rental scams in Canada, and have become an increasing problem in recent years.

The typical signs of a fraudulent document include:

• Formatting errors from irregular font use to spacing and alignment inconsistencies
• Account summaries not matching account overviews
• Whole numbers after taxes 
• Employer contact info that doesn’t trace to a real company

But now, with AI, these scams are going unnoticed. What used to be a crude Photoshop job has become a sophisticated, fast-moving scam that is easier than ever to execute. Free online templates and AI tools make it easy to generate convincing pay stubs, employment letters and bank statements in seconds. Logos look authentic. Tax deductions appear accurate. Even bank deposits can be simulated with AI tools.

It’s become increasingly difficult for Realtors to spot these fakes with the naked eye, especially when dealing with time-sensitive leases or multiple applications.

An example of a fake paystub. Clues to detect its inauthenticity include fuzzy fonts and an outdated company name for the employer.

The cost of scams for Realtors

Realtors understand the cost of rental scams goes far beyond lost income. It’s months of legal headaches, unpaid rent and the uphill battle of removing a problematic tenant. Once a risky tenant is in, recovering the unit (and the funds) becomes a long, time-consuming and uncertain process.

Beyond income loss, rental scams can be damaging to a Realtor’s reputation. Realtors are market experts, and investors put their trust in Realtors’ judgment when it comes to rental screening. Persistent scams, the toll on mental health, and the headache of the ordeal can cost a Realtor the investor’s trust, and ultimately, their reputation. Realtors need tools that even the playing field and use AI to their advantage. 

AI didn’t create rental scams — it exposed the gap 

AI hasn’t created a new rental scam problem; it’s just exposed an existing one more clearly.

Rental scams persist because Canada’s rental market lacks the standardization and safeguards that protect other major investments. You wouldn’t buy a car or home without insurance; renting should come with its own layer of protection. 

That’s where trust infrastructure comes in. A set of tools and processes that build accountability, increase transparency, and reduce risk for landlords and Realtors alike. And now, it includes AI. 

While AI has made it easier to create fake documents, it’s also being used to detect them, flagging mismatched fonts, suspicious file metadata, irregular pay cycles and other red flags that even experienced agents might miss.

How to put trust infrastructure into practice

AI may have exposed the gaps in rental screening, but it can also help close them. To stay ahead of increasingly sophisticated scams, Realtors must evolve their screening processes, adopt safeguards and leverage AI to build what the industry needs most: trust infrastructure.

This means combining smart tools with consistent, repeatable practices that reduce risk for clients and put trust back into the landlord-tenant relationship.

A few of these practices include: 

• Complete background checks with verified digital channels – Whenever possible, request income verification on platforms connected to Equifax and TransUnion to create a full picture of the potential tenant. 
• AI-powered documentation and income verification – Use AI as the first line of defence, tracking easy-to-hide edits such as mismatched fonts, layout inconsistency and covered information before it reaches you. 
• Pre-screen risk scoring – Leverage AI to support with the initial assessment of tenant documents, from credit scores, pay stubs and existing debts, to empower decision makers to move quicker and weed out high-risk applicants.
• Regular audits of screening outcomes – Technology paired with Realtors’ market expertise creates efficient and knowledgeable systems. Realtors should take the time to review current systems for bias or false positives, to continuously find ways to leverage AI in a way that works best for them.

The bottom line

Fraudulent applications aren’t going away. They’re part of a broader affordability crunch reshaping the rental market and unveiling the cracks in the current process.

Sharp eyes are no longer enough; the rental market needs systems that create accountability and transparency. At SingleKey, we’ve seen these systems in action firsthand: tenants know their information will be verified, and landlords know their income is protected.

When Realtors combine digital verification tools with automated rent collection and rent guarantee, they are not just screening tenants; they are also protecting income and increasing confidence across the board.

Viler Lika

Viler Lika is the founder and CEO of SingleKey, a leading rental risk intelligence platform that helps landlords, property managers, and Realtors verify tenants and protect rental income. Viler holds an MBA and a computer engineering degree, and he has a background in lending and consumer credit risk at Capital One and TD Bank. Viler is now focused on bringing a fairer, data-driven, transparent and more accountable leasing experience to landlords and Realtors to make renting stress-free.

The post AI scams are a growing threat to landlords – here’s how to protect your clients appeared first on REM.

The Real Estate Council of Alberta (RECA) announced the lifetime ban, effective Sept. 22, following a disciplinary hearing in May where Drinkwater admitted to soliciting fraudulent bridge loans. 

In its decision, the independent hearing panel described his conduct as “among the most severe” RECA has ever addressed.

Drinkwater, who was licensed with Re/Max Real Estate (Central) and RE/MAX Complete Realty during the misconduct, was also ordered to pay $9,500 in hearing costs. 

Drinkwater has 30 days to appeal the decision. RECA said it will provide records to law enforcement and the courts as needed.

Civil lawsuits and criminal charges brought by the Calgary Police Service remain ongoing and are separate from RECA’s disciplinary process.

This marks the third permanent ban issued by RECA since 2022.

Courtney Zwicker

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.

The post RECA bans Drinkwater for life over Ponzi scheme appeared first on REM.

In Manhattan, a brokerage lost over $1 million. An agent clicked on an email with a malicious link, which allowed the criminals to gain access to their email account. The criminals then monitored past and current emails, learning when a large commercial closing was to occur and with whom. Using the compromised account, they diverted the transfer of funds to accounts they controlled.

Clients are also targets. Criminals pay attention to sales, using the public nature of the web and savvy intelligence gathering (called open source intelligence). They can learn when a closing is going to occur and create an email that appears like it’s coming from the title company with fraudulent wire transfer instructions. 

Some research has shown that as many as half of real estate transactions show signs of potential wire and transfer fraud, and half of real estate professionals encountered seller impersonation fraud attempts. One in two.

What is the fix? Or rather, how can I protect myself and my clients better?

What you can do

Education can apply to both the professional and the client. As a professional, spend time with your client and lay out exactly how and with whom monetary transfers will be conducted. Implement a protocol on the day of the transfer, where you are with them every step of the way, or at least provide a trusted alternative. Confirm all the details of the transfer verbally before pressing send. 

Where possible, use secure portals to send wire transfers, and not through email. Implement controls, such as validating identities, and even have two people verify all transactions.

For professionals, learning to identify phishing scams is a must. There are many videos on the internet with tips and tricks on how to spot a scam. 

All of this training emphasizes the importance of being vigilant when encountering requests to click or download a link in a financial context. An example of this could be an email from your manager stating that escrow account transfer details have changed. In cases like this, use a different form of communication, like a phone call, to confirm the request.

What about deepfakes?

Criminals are using AI tools to create “deepfakes.” This technology can be used to generate realistic audio or video of people while on a remote call.

In Florida, a title company avoided being scammed when it asked a prospective buyer on a video call to raise its hand. It couldn’t do so, which confirmed their suspicions that the call was a deepfake.

Using alternate channels to communicate and verifying identities using requests that non-humans would struggle with are some simple ways to detect these tactics. 

Two-factor authentication should be enabled on all accounts, including email. Email uses various factors to detect if you are the one signing into your own account. If these checks fail partially, then a code will be sent to your phone or authenticator to confirm the login.

Lastly, assume the worst is going to happen and plan for it. This could mean checking your insurance coverage, whose policies often don’t cover wire fraud losses. In cybersecurity, there is a mantra that it is not if you will be hit, but when. Ensure that you have commercial crime or cyber liability insurance and that it includes wire fraud coverage. 

Also, spend some time planning your behavior when this does happen. What are the specific steps you will take when you learn that criminals are involved in your business and deals? Who will you alert first, and then next? This will no doubt involve company management, financial institutions, and law enforcement. 

If you are able to, reach out to a cyber professional to assist your brokerage. They can provide some tips on implementing secure strategies. They can also help run awareness training and assist with creating an incident response plan, which is the actions to take when you encounter fraud or any other cyber incident.

It’s easy to feel overwhelmed by all the steps involved with staying protected. But peace of mind doesn’t have to take days of work and break the budget. By spending a little time beforehand, you and the people you work with can dramatically reduce the threat of fraud.

Ryan Thompson

Ryan Thompson is a cybersecurity professional with over five years of experience. Specializing in awareness and offensive security, he has worked with governments, big companies and charities. He hopes to engage with small businesses to ready them against cyber threats.

The post The role Realtors can play in preventing wire fraud appeared first on REM.

Drinkwater’s scheme centred around falsified bridge loans for non-existent real estate transactions. Drinkwater was charged by Calgary police on May 8. Police reported 16 victims came forward with a combined loss of more than $1.9 million. 

In a recent disciplinary hearing of the Real Estate Council of Alberta, Drinkwater admitted that the total amount invested in the scheme was $3.5 million, and an investigation found there were at least 71 victims, and possibly dozens more.

The outcome of Drinkwater’s RECA hearing is pending.

Hare and Lem RECA hearings scheduled

Industry watchdog RECA has scheduled three days of disciplinary hearings for Pat Hare and David Lem from Aug. 18-20.

Hare is the well-known founder of the longtime Calgary brokerage formerly known as Re/Max Central, historically a top-performing office, where Drinkwater was employed during the time he carried out his scheme. 

The hearing panel will determine whether Hare is deserving of sanction for allegations connected to his involvement in the fraud.

According to RECA’s notice of hearing, Hare is alleged to have been made aware of Drinkwater’s scheme in 2021, and received payments from Drinkwater that he “knew or ought to have known came from the fraudulent scheme.”

Other allegations include:

• Hare was aware of numerous complaints concerning Drinkwater’s conduct and he participated in concealing the activity, allowing it to continue.
• Hare counseled Drinkwater to keep his fraudulent activities secret to conceal his activity and prevent a disciplinary investigation by RECA.
• Hare used his control over Drinkwater’s legitimate real estate commissions to put his funds out of reach of creditors.

Allegations against Lem

Lem, who was the broker/manager at the time, is facing allegations of being “willfully blind to Drinkwater’s conduct related to the fraud” as early as 2021.

Allegations against Lem include:

• Failing to take reasonable steps to correct the misconduct or reduce any harm that may have resulted from the misconduct upon becoming aware of it.
• Failing to notify the registrar upon becoming aware of misconduct.

Blue Sky ineligible for Commission Protection for now

Just weeks after Re/Max dropped Re/Max Central from its franchise network due to allegations surrounding Drinkwater’s scheme, Hare’s son Mackenzie Hare charted a move to Royal LePage under a new name, Royal LePage Blue Sky.

The Alberta Real Estate Association has deemed 4th Street Holdings and Blue Sky ineligible for its Commission Protection Program, which protects agents’ commissions when a broker goes out of business. 

It does not have any effect on the brokers’ day-to-day business, AREA CEO Brad Mitchell told Real Estate Magazine. 

“It simply means that if the brokerage goes out of business and if the commissions to agents are not paid, the agents would be ineligible to apply to the fund to pay their commissions,” said Mitchell. 

He said Blue Sky has been deemed ineligible because AREA’s board has determined “it is outside its risk tolerance at this time.”

“This is not a permanent state,” he said. “We have only suspended coverage until we can conduct a comprehensive review of the risks and we have reached out to Blue Sky through our legal counsel.”

Courtney Zwicker

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.

The post Associates of Calgary’s Eric Drinkwater dragged into fraud fallout appeared first on REM.

Re/Max dropped Re/Max Central from its franchise network due to allegations surrounding a multi-million-dollar Ponzi scheme run by former employee and Hare’s nephew Eric Drinkwater.

On Thursday, Royal LePage confirmed the launch of Royal LePage Blue Sky, led by Hare’s son Mackenzie Hare. Blue Sky is understood to be the landing pad for Realtors of the brokerage formerly known as Re/Max Central. 

“We are pleased to be able to offer a new home to a large roster of hardworking and respected real estate professionals, and ensure they have the support and resources they need to continue providing high-quality service to their clients and community,” said a statement from Royal LePage.

“The team is thrilled to be joining Canada’s Real Estate Company. At Royal LePage, we pride ourselves on our integrity and the professionalism of our network.” 

Mackenzie Hare, a CPA by trade, was hired in 2020 as a manager at Re/Max Central, according to an online profile. The brokerage was founded by his father more than 40 years ago. 

Mackenzie Hare could not be reached by deadline.

One-third of agents left at former Re/Max Central

Re/Max Central once boasted having more than 280 Realtors. 

As of Thursday, there were 95 agents registered with 4th Street Holdings, the parent company of Re/Max Central.

As revelations of the fraud scandal came to light, agents began leaving Re/Max Central as early as 2024, a source told Real Estate Magazine.

The exodus picked up in recent weeks and months as the news became more widely known. 

In the last week of May alone, 30 agents transferred from Re/Max Central to other brokerages in the city, according to Calgary Real Estate Board data. 

Drinkwater’s scheme centred around falsified bridge loans for non-existent real estate transactions. Drinkwater was charged by Calgary police on May 8. Police reported 16 victims came forward with a combined loss of more than $1.9 million. 

In a recent disciplinary hearing of the Real Estate Council of Alberta, Drinkwater admitted that the total amount invested in the scheme was $3.5 million. 

Courtney Zwicker

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.

The post Calgary’s Mackenzie Hare repositions under Royal LePage following brokerage’s Re/Max split appeared first on REM.

Brad Mitchell is the CEO of the Alberta Real Estate Association, a not-for-profit professional association representing the interests of more than 15,000 Alberta Realtors from 10 local real estate boards/associations.

Albertans deserve the confidence that their real estate transactions, often the most significant financial commitments of their lives, are conducted within a regulatory framework designed, first and foremost, to protect the public. That is the cornerstone of professional real estate regulation. Unfortunately, recent events have raised serious concerns about whether Alberta’s regulator is fulfilling its mandate.

The case involving Eric Drinkwater, formerly of Re/Max Central in Calgary, has revealed a deeply troubling situation. Civil litigation, criminal charges, and the removal of Re/Max Central from the Re/Max network are all part of a broader failure of oversight. Most distressing is the impact on the victims, many of whom are Realtors, and the erosion of trust this incident has caused.

Despite clear authority under the Real Estate Act, particularly Section 53, which allows the Chair of an Industry Council to suspend and impose conditions on licensees in the public interest without a hearing, those tools were not and are not being used properly. This was not a failure of legislation. It was a failure of execution. This is not an isolated failure. It reflects a pattern of inaction and misplaced priorities that have steadily undermined public confidence in the Real Estate Council of Alberta (RECA) and its ability to fulfill its duties.

Consumers “left at risk”

In 2018, the Government of Alberta commissioned a report that uncovered serious problems within RECA. In response, the province introduced significant reforms, including the Real Estate Amendment Act, which took effect in December 2020. One crucial change was made to Section 54 of the Act. It requires RECA’s Industry Councils to reject requests from licensees who want to voluntarily withdraw from the profession if there are credible allegations of fraud or criminal activity that warrant investigation.

Despite this clear requirement, RECA did not implement the change. It only began to enforce the provision after the Minister responsible for Service Alberta issued a formal directive several years after the law had taken effect. Even then, the RECA Board did not inform Industry Council members about the Minister’s directive. Council members only learned about it through an advisory issued by AREA.

As a result, consumers in Alberta were left at risk. Individuals facing serious allegations were allowed to leave the profession without facing any consequences. In one case, a licensee was granted a lifetime withdrawal from RECA and resumed selling new homes the following week.

A look at RECA’S spending

It is difficult to reconcile failures like these with RECA’s spending priorities. 

While RECA has spent money on initiatives such as building a private employee gym and paying off a $13 million mortgage, it has simultaneously cited financial constraints as a reason for its limited enforcement capacity. In any public-serving institution, especially one with regulatory responsibilities, such spending choices warrant scrutiny.

“Inadequate response” to Drinkwater fraud case

AREA has long advocated for a regulatory system in Alberta that is transparent, competent, and focused on the public good. In this case, the regulatory response has been inadequate. 

RECA has stated that in the Drinkwater case, it acted “swiftly and in strict accordance with our regulatory obligations,” but such assurances ring hollow given the extent of the harm. Speed and diligence must be measured not by RECA’s internal timelines but by the consequences of inaction and the public’s interests.

RECA to go under the magnifying glass

AREA supports the Alberta government’s decision to conduct a full review of RECA’s operations and governance. A regulator must not only be independent but also effective. Regulatory independence cannot serve as a shield against accountability. 

Our industry relies on a well-functioning regulator to uphold standards, enforce rules, and ensure consumer confidence. When enforcement is delayed, regulatory tools go unused, and resources are diverted away from public protection, the system fails to serve its core purpose.

AREA will continue to advocate for the victims in the Drinkwater case, including seeking compensation through the Consumer Protection Fund. If current policies are insufficient to meet the needs of victims, they must be revised. A fund intended to protect consumers must do just that.

There is now an opportunity to reset Alberta’s real estate regulatory system—to ensure that enforcement is proactive and that transparency is practiced and not merely promised. Real estate regulation is not about image. It is about trust. It is about responsibility. And it is about acting swiftly in the public interest when that trust is at risk.

The public deserves better. And the professionals in our industry, who work every day to uphold high standards, deserve a regulator who shares and reflects that same commitment.

Brad Mitchell

Brad Mitchell is the CEO of the Alberta Real Estate Association.

The post OPINION: Alberta’s real estate regulator must do better appeared first on REM.

In a decision of the Court of King’s Bench of Alberta dated April 24, Justice Barbara Romaine found Hare, a Realtor of more than 40-years, knew about the multi-million-dollar scheme as far back as 2022.

Last week, Re/Max announced it cut ties with Hare’s brokerage Re/Max Central amid the Ponzi scheme controversy.

Hare is the uncle of Drinkwater, who is charged with $1.9-million in alleged fraud. 

Already, $2.28-million in losses, $185,000 in interest, and $1-million in punitive damages has been awarded to four victims in a civil suit. 

Drinkwater’s criminal trial is set to begin this month.

Email exchange

The decision includes details of several email exchanges between Drinkwater and Hare, including one where Drinkwater states that he will call the Real Estate Council of Alberta, the industry regulator. 

In response, Hare said: “you do not have to call reca unless you go bankrupt [sic]. What are you going to do tell them that you stole other people’s money or put them on a Ponzi scheme [sic].” 

Ultimately, no one reported Drinkwater to RECA, reads the decision.

“Despite knowing of the scheme, Mr. Hare did not report Mr. Drinkwater’s conduct to the RECA, and in fact, advised Mr. Drinkwater against reporting himself,” says the decision.

 “Mr. Hare enabled Mr. Drinkwater to continue the scheme, and he himself received regular payments from (Drinkwater’s company) during the period that Mr. Drinkwater was continuing with the scheme.”

Managing broker also aware of Drinkwater’s activities

According to the decision, in Dec. 2021, Re/Max Central broker/manager David Lem became aware that Drinkwater was borrowing money from individuals and not paying it back.

Lem said he reported this to Hare between Dec. 2021 and Jan. 2022. 

They met with and negotiated a release with a complainant on behalf of Drinkwater and RE/MAX Central, reads the decision.

In August 2022, more of the scheme came to light, and in early 2023, the “floodgates opened,” reads the decision, and several more complaints related to the scheme were received.

In March, 2023, Lem said that he, Hare and Drinkwater met to discuss Drinkwater’s conduct. At this point a deliberate decision was made not to report Drinkwater to RECA, reads the decision.

Days later, Lem sent an email to Drinkwater and Hare stating, “In short, we’ll make every effort to diffuse any situation that comes to our attention that you make us aware of and we will leave it to an internal matter at this time,” reads the decision. “However, I will be bound by RECA’s requirement to report any further instances we have not be made aware of in advance. Thank you.” 

Lem told the courts that one of the reasons that he did not make a report to RECA was because he thought Hare was going to fix the issue, given the personal relationship between him and Drinkwater.

Judge freezes assets

Judge Romaine’s decision orders a Mareva injunction, a temporary order that effectively freezes an asset pending a future order, which was sought by four of Drinkwater’s victims.

The victims submitted that a Calgary home was fraudulently transferred from Drinkwater to Hare. 

Romaine found that Drinkwater transferred money to Hare during the period of the scheme, and the money was used to pay the mortgage on the home, to Hare’s benefit.

While there is insufficient evidence to support that claim, Romaine wrote, there is evidence that Hare has been making attempts to sell the property despite his knowledge of the claims involving the property.

The order temporarily prevents any transactions relating to the home. 

Courtney Zwicker

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.

The post Former Calgary Re/Max brokerage owner kept Ponzi scheme secret from RECA, says Alberta’s top court appeared first on REM.

The brokerage was the employer of former Realtor Eric Drinkwater, who is charged with $1.9-million in alleged fraud. 

He is the nephew of Hare, who has been a Re/Max realtor for more than 40 years. 

“We can confirm that the independently-owned and operated Re/Max Real Estate (Central) in Calgary, Alberta, has been terminated from the Re/Max network and its owners are no longer affiliated with the Re/Max brand,” said a company statement.  

“The Re/Max network shares and honours a commitment to professionalism, integrity and honesty. The goal is not simply to meet minimum requirements of applicable laws, regulations and professional standards, but to aspire to even higher levels of professionalism.”

RECA’s response

Drinkwater appeared before a disciplinary panel last week of the Real Estate Council of Alberta. He has been suspended since June 2024 and faces a lifetime ban from the regulator.

Hare remains actively licensed.

RECA declined to confirm whether Hare is being investigated.

“RECA has a legislated process that we follow. As the regulator, we must ensure that our actions don’t impact the independent hearing or jeopardize victims’ rights,” it said.

“Until the independent hearing panel issues its decision, we remain limited in what we can say.”

What happened 

The scheme is believed to have occurred between March 2020 and February 2024.

During the RECA hearing, Drinkwater admitted to falsifying bridge loans for non-existent real estate transactions that he claimed were taking place through his former employer, Re/Max Central.

In reality, no such transactions existed, and the documents he provided to support the scheme were forgeries. 

Courtney Zwicker

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.

The post Re/Max severs ties with one of Calgary’s biggest real estate names amid Ponzi scheme controversy appeared first on REM.

Drinkwater appeared in a virtual disciplinary hearing held by the Real Estate Council of Alberta, where he agreed to a laundry list of illicit activities that amounted to a significant Ponzi scheme affecting 71 confirmed victims, and maybe dozens more, an investigation found. 

Given the extraordinary nature of Drinkwater’s actions, RECA’s office of the registrar did not make a specific argument for sanction, and is leaving the decision to the independent panel. 

However, RECA’s lawyer, Andrew Bone, said the registrar has submitted a precedent case that supports a lifetime ban to aid in the panel’s decision. 

 Drinkwater’s licence has been suspended since June 2024. 

“Conduct on this scale is unprecedented for a RECA hearing,” said Bone. “Drinkwater has participated in serious and extensive fraud over the course of his dealings. The nature of this breach is extremely serious.”

The panel can take up to 60 days to provide its written decision. Once it is provided to the parties, it will be made public after the 30-day appeal period.

Drinkwater’s admissions

The scheme is believed to have occurred between March 2020 and February 2024.

During the hearing, Drinkwater admitted to falsifying bridge loans for non-existent real estate transactions that he claimed were taking place through his former employer, Re/Max Central.

In reality, no such transactions existed, and the documents he provided to support the scheme were forgeries. 

A Realtor of 19 years, Drinkwater admitted to targeting past real estate clients and fellow Realtors, in addition to members of the public.

“The mandate of RECA includes to protect against, investigate, detect or suppressing fraud. Drinkwater’s conduct strikes at the heart of this mandate,” said Bone.

Drinkwater was charged by Calgary police on May 8 with one count of fraud over $5,000. Police reported 16 victims came forward to police with a combined loss of more than $1.9-million. Drinkwater is scheduled to appear in criminal court next month. 

On Mar. 3, Loberg Ector LLP announced it had secured a judgment against Drinkwater in a civil lawsuit filed by four plaintiffs. The court awarded $2.28-million in losses, $185,000 in interest, and $1-million in punitive damages.

Drinkwater claims he didn’t profit

Drinkwater admitted that the total amount invested in the scheme totalled $3.5-million. 

His statement of agreed facts states that $1.1-million was used to repay debts related to the scheme, and a small amount was used for personal expenses. 

“I provided all my bank statements to the Calgary Police Services. They verified that I did not profit off this in any way,” said Drinkwater, adding that during this period, he could “barely pay for groceries.” 

Drinkwater said the sheer number of people who gave him large sums of money did so because they trusted him and believed in his reputation as a Realtor. 

“I had that much trust, and I didn’t deserve it, obviously,” he said.

He said he betrayed “a lot” of his colleagues with his actions.

“I’m going to have a harder time making up those relationships, and I’d like to apologize to all of them,” he said.

Bone noted that the majority of outstanding funds remain outstanding.

“Beyond the loss of money itself, Drinkwater’s victims also face significant stress and anxiety when their funds were misappropriated,” said Bone.

Maintaining public confidence

Bone said an example must be made of Drinkwater.

“The need for deterrence is significant. A clear message must be sent to members of the public and licensees that fraudulent schemes will not be tolerated and will carry significant sanctions.”

Courtney Zwicker

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.

The post Former Calgary Realtor Eric Drinkwater admits to Ponzi scheme, faces possible lifetime ban appeared first on REM.

A husband and wife who claim they were scammed by former Calgary Realtor Eric Drinkwater say roadblocks with the Real Estate Council of Alberta are adding to their strife as they seek justice.

The couple, who asked to remain anonymous to protect their reputations in the oil and medical fields, says they lost $87,000 after agreeing to invest with Drinkwater in 2022. 

Calgary police charged Drinkwater on May 8 with one count of fraud over $5,000. Investigators say Drinkwater solicited loans disguised as real estate investment opportunities, resulting in at least 16 victims and a combined loss of more than $1.9-million.

A professional history with Drinkwater

According to the pair, they met Drinkwater in 2019 after hiring him as their Realtor to buy their house. They hired him again when they sold that home in January 2022.

They allege Drinkwater approached them in May 2022 with an offer to invest in bridge loans for his real estate clients, saying they trusted Drinkwater because of his credentials as a Realtor with Re/Max Central.

“We know the secondary market exists, so it was not something that seemed so alien because it was coming from a Realtor,” they told Real Estate Magazine. 

Drinkwater held up his end of the bargain for the first number of deals, and in total, they say they invested $236,000.

Things went “sideways” when the deals started getting bigger. They say Drinkwater began having excuses and not keeping his word.

“He must have had five or six uncles die within a six-month period,” they said.

In early 2023, the couple says they learned of another person who had a judgment against him. By October 2023, they had a consent judgment against Drinkwater, obtained by their personal lawyer, according to the pair who says they’ve spent $10,000 on legal fees.

The couple says they were prepared to cut their losses and move on until more victims began to surface in 2024. 

Frustration with RECA

Despite criminal charges against Drinkwater and RECA’s own in-depth investigation, they say they are still having to fight tooth and nail for justice. 

They say they met with two representatives from RECA in late 2024 and sent over all the documentation that was requested. 

They say they’ve heard little back from RECA, and they’ve been told their consent judgment is not enough evidence to build a case for retribution. 

“There’s no process working with RECA. They control everything.” 

Waiting for justice 

The couple is part of a group of about seven victims who are hoping to be eligible to apply to the Real Estate Assurance Fund for restitution. 

Victims have been told that the prerequisite for applying is a judgment of fraud in civil or criminal court. Drinkwater is scheduled to appear in court in June to have his criminal case heard.

RECA spokesperson Shawn Howard said the association empathizes with those who bring claims forward, but there are rules it must follow.

“No one wants to be in a situation where they need to turn to the Assurance Fund, and when people do, we understand how serious it is for them,” he said.

Howard said RECA’s lawyer who administers the fund has been in contact with a number of people (or their counsel) to help them understand the application process and protect their rights.

“There are rules and procedures we must follow to assess all claims – this is set out in the legislation the fund is established under and governed by – and if there are outstanding questions, we are happy to address those with people.”

The fund is collected and issued by RECA, and protects consumers from unethical behaviour by real estate professionals. It was set up to compensate consumers who suffer a financial loss, and it covers fraud under real estate and mortgage practices.

Compensation paid from the fund since its 1985 inception totals $3.6-million, according to RECA’s most recent annual report. Over the last 10 years, the average amount paid out per year has totalled $165,000. RECA paid $54,301 in compensation from the fund in 2023-2024.

The vast majority of Drinkwater’s alleged victims do not have enough evidence and documentation to get a conviction, or they’ve chosen not to pursue justice, according to a source with direct knowledge of the situation.

Plaintiffs in the civil case submitted evidence that included an acknowledgement by Drinkwater to RECA that victims numbered at least 71, and may have exceeded 100, according to a press release from the victim’s counsel, Loberg Ector LLP.

On Mar. 3, Loberg Ector LLP announced it had secured a judgment against Drinkwater in a civil lawsuit filed by four plaintiffs. The court awarded $2.28-million in losses, $185,000 in interest, and $1-million in punitive damages.

Regulator hearing upcoming

A virtual hearing is slated for Thursday for a panel to review allegations of Drinkwater’s conduct. 

The council suspended Drinkwater’s licence in June 2024, and the hearing will determine any further sanctions from the industry watchdog, including the possible cancellation of his real estate license.

Drinkwater did not return a request for comment. 

Courtney Zwicker

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.

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