Mortgage Brokering
Public comment closed
Comment Due Date

Thank you for providing your feedback on FSRA’s proposed Guidance on Detecting and Preventing Mortgage Fraud.

The request for submissions is now closed.

We appreciate the comments and questions received to date and look forward to sharing with you the final Guidance. Stay up to date on Guidance releases on our newsroom. Follow us on LinkedIn and subscribe to our mailing list for quick updates.

The Financial Services Regulatory Authority of Ontario (FSRA) is holding additional consultations on guidance that describes requirements for FSRA-licensed mortgage brokers, agents, brokerages and administrators to deter deceptive and fraudulent practices in the mortgage brokering sector.

“During these times of high inflation and rising interest rates we need to do everything we can to protect individuals and families from becoming victims of fraud,” said Huston Loke, Executive Vice President, Market Conduct. “With the valuable input of our stakeholders, we have strengthened our proposed guidance on detecting and preventing mortgage fraud and we look forward to hearing more from the public on this important initiative.”

As a result of feedback received from stakeholders during the December 2021 public consultation, FSRA is proposing changes to the proposed guidance. These changes include additional content on:

  • Addressing the duty to verify documents and identities
  • Ensuring appropriate anti-fraud policies, procedures and training are in place and updated regularly
  • Clarifying the role of principal brokers at brokerages and principal representatives at administrators in preventing and detecting fraud

FSRA may take enforcement action against licensed mortgage brokers, agents, brokerages and administrators if it receives credible information about potential fraud or failure to comply with the law and its regulations.

FSRA has authority to regulate and sanction licensed mortgage brokerages, brokers, agents and administrators. When fraud involves more than FSRA-licensed persons or businesses, FSRA works with the appropriate law enforcement agencies with jurisdiction over those other persons or businesses.

The consultation period for proposed guidance on Detecting and Preventing Mortgage Fraud is now open and will close on April 26, 2023.

Learn more:

FSRA continues to work on behalf of all stakeholders, including consumers, to ensure financial safety, fairness, and choice for everyone.

Learn more at


Before we begin, please make sure you do not include any personal or private financial information. If your inquiry does require this information be shared with us, please call us at 1-800-668-0128 or email us at [email protected] for instructions.

By submitting your content, you agree to have your materials posted on our engagement portal, used in reports and other materials prepared by Financial Services Regulatory Authority of Ontario (FSRA) that may be shared with the public. Content is moderated so that all posts are respectful and professional. The Freedom of Information and Protection of Privacy Act, R.S.O. 1990, c.F.31, applies to all online content.

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Sector Comment Date posted Sort ascending
Mortgage Brokering
[2023-003] Karen Decker - Stewart Title

Mortgage Brokering
[2023-003] André Hannoush - Appraisal Institute of Canada

Mortgage Brokering
[2023-003] Jasmine Toor - Mortgage Professionals Canada

Cross Sector
[2023-003] FSRA Consumer Advisory Panel

Mortgage Brokering
[2023-003] Samantha Gale - Canadian Association of Private Lenders
Please see attached letter for comments on the proposed guidance. Thank you! Samantha
Property and Casualty and General Insurance
[2023-003] Ed Steel - Mortgage and Title Insurance Industry Association of Canada

Cross Sector
[2023-003] Jay - Krushell
In order to meaningfully reduce the risk of identity-based fraud associated with real estate transactions, licensees must do multi-factor authentications to verify the identity of every one of their clients. Our detailed submissions are attached.
[2023-003] John Rider - Chicago Title Insurance Company Canada
Attached please find a cover letter and comments submitted by Chicago Title Insurance Company Canada on FSRA's Proposed Guidance on Detecting and Preventing Mortgage Fraud.
Cross Sector
[2023-003] Michael Brooks - REALPAC
I would suggest that you try to beef up the know your client rule as much as possible. If we suspect that the fraud artists are using fake ID, then perhaps better identification minimums should be put in place, including a facial photograph. This would need to be accompanied by the right to use that facial photograph in any facial recognition software whether used by FSRA or other authorities. With ID so easy to fake, we really need a better system of title and know your client for every participant in this market eventually.
Mortgage Brokering
[2023-003] Marvin Cajina - Mortgage Brokers City Inc.
Good morning,

The best way to ensure mortgage brokerages are verifying documents and identities as well as having relevant anti-fraud policies and procedures are in place and updated regularly is to require mortgage brokerages to submit audited financial statements. The scope of an audit requires the external auditor to obtain an understanding of relevant internal controls. Any deficiencies with the control environment will be communicated by the external auditor with a management letter. Along with requiring mortgage brokerages to be audited have them also submit an auditor’s management letter with the audited financial statements.
Clarifying the role of principal brokers at brokerages and principal representatives at administrators in preventing and detecting fraud should actually be included in the Public consultation on guideline B-20: Residential Mortgage Underwriting by the Office of the super intendent. Public consultation on guideline B-20: Residential Mortgage Underwriting ( Another alternative is to have them be required to register to FINTRAC which will require mortgage brokerage to review clients for Anti-money Laundering.
However, I do agree that expectations should be set for detecting and preventing fraud for the mortgage brokerage and principal broker. But the expectation should be realistic. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal controls. Therefore, expectation should be based on risk. If the mortgage brokerage identifies a certain risk then a procedure must be followed to address and mitigate the risk. Essentially, all identified risk should be addressed.

Thank you.

Marvin Cajina, CPA, CA
Mortgage Brokering
[2023-003] Oyekunle Afolabi - Pegasus agent
Fraud in the mortgage industry is enabled by agents and brokers on one part because that is the only way for most to get business and on the other part it is aided by FSRA by making agents slaves to the brokerages who engage agents without willingness to train them and are not even interested in physical meeting with agents in their brokerages even when the agent insist on knowing personnel in the brokerage he is working with. Brokerages are just interested in recruiting agents to earn monthly fees from the agents irrespective of the agent making a success or not from it. In cases agents pay for services that brokerage never delivers.
No questions have been asked about this consultation yet.