At FSRA, we trust that mortgage professionals operate with integrity, and we continuously verify that firms and individuals remain suitable to be licensed.
One of the ways we verify is by conducting examinations. Because we believe strongly in a collaborative relationship between the regulator and industry, we want to help you understand what to expect if you've been selected for an examination.
The purpose of an examination
An examination is intended to assess how well your company’s approach to business, its processes and operations enable and support staff to provide client services in a fair and compliant way. This starts with understanding your business.
Once we understand the context within which your business operates, we ask for documentation, including policies, procedures, financial records, transaction details and full file packages for review.
Where we find non-compliance, our approach is to help guide improvements to internal processes so businesses can prevent poor consumer outcomes more effectively. Examinations are educational for both sides, and we aim to foster a collaborative and open process.
What happens during an examination?
We pick firms based on their business activities and how they score against key risk indicators, which can include (but are not limited to):
- The nature of the business (e.g., brokering, lending, trading, administering, combination)
- Product types (e.g., private mortgages, syndicated mortgage investments (SMI), construction/development financing, etc.)
- Size and geographical spread of operations (including number of licensed agents/brokers)
- High number of complaints received or media reports
- Portfolio size (by $ volume and/or # of units)
From there, we gather information to understand their overall business, organizational structure, client base and product offerings, and evaluate their internal processes and controls.
Doing so helps us determine how a given firm is treating their clients fairly when making mortgage recommendations or administering mortgage investments.
We also speak with employees at all levels of the firm, including staff, licence holders, management and ownership. Since protecting consumers is everybody’s responsibility, we connect with individuals at different levels of seniority and with different perspectives at your firm.
We also review a sample of individual files to assess the effectiveness of processes which are in place.
FSRA’s supervisory approach
FSRA’s supervisory cycle includes 6 key parts:
- Gather information
- Assess risk
- Develop supervisory programs
- Implement programs
- Monitor and communicate
- Evaluate outcomes
We start by conducting research to identify consumer protection concerns.
Then we conduct a risk assessment and develop our annual supervision plan. The plan explains the rationale for our concerns and explains our course of action to protect consumers.
Once the plan is published, its key themes form the basis of our examination programs.
Learn more
Be sure to review all relevant Guidance and other publications to better understand how we oversee your industry.