A Vancouver man and his company have been ordered to pay a total of $80,000 to B.C.’s real estate regulator after admitting to providing property management services without a licence for more than eight years.
Peter Ho Chiu Chu and 168 Rock Solid Homes Ltd. admitted their unlicensed operation and agreed to the penalty in a consent order agreement with the B.C. Financial Services Authority, which was published online Monday.
According to the document, Chu told BCFSA staff that – until they contacted him to investigate his conduct – he was unaware that property managers were required to be licensed in B.C.
He has since applied for licensure, but the consent order notes that his application was placed on hold while the regulator investigated the case.
The Office of the Superintendent of Real Estate, a precursor to the BCFSA, began its investigation after receiving a complaint about Chu and Rock Solid in August 2019, according to the document.
The investigation soon identified “at least” 31 properties – located in Vancouver, Richmond, Delta, Burnaby and West Vancouver – that Rock Solid had managed between 2012 and 2020.
According to the consent order, Rock Solid offered services including advertising properties for rent, screening prospective tenants, signing and managing tenancy agreements, collecting security deposits and rents, making and supervising repairs, and representing owners at Residential Tenancy Branch hearings, among other things.
For these services, the company charged 8.333 per cent of rental income, plus GST on maintenance fees and $100 per RTB appearance.
Chu was the sole director of Rock Solid, according to the consent order. In May 2020, he provided an undertaking to the OSRE promising to cease providing real estate services unless he held a valid licence.
However, further investigation showed that Chu continued to provide property management services for free, “in anticipation of future remuneration once he became licensed,” according to the document.
The consent order details more back-and-forth between the parties, culminating with the OSRE issuing an “order in urgent circumstances” directing Chu and Rock Solid to stop all property management services.
Chu told staff he complied with this cease order.
“Mr. Chu was co-operative throughout the investigation by providing documents in his possession or control and attending an interview with investigative staff as requested,” the consent order reads.
“Mr. Chu’s understanding of the scope of the undertaking is that it prohibited the provision of rental property management services for or in expectation of remuneration, and that provision of such services for free was not prohibited.”
The document notes that Chu has no prior discipline history with the BCFSA or its predecessor organizations.
In the consent order, Chu admitted to his unlicensed property management and agreed to pay a $75,000 administrative penalty, plus $5,000 in investigation costs.
It’s the second penalty the BCFSA has levied against Chu’s household in as many months. In May, Chu’s wife Rena Liang and her Personal Real Estate Corporation agreed to pay the regulator $50,000 for professional misconduct.
Liang’s misconduct included directing the tenant of a West Vancouver property to provide rental payments to Chu, despite knowing that he was not licensed, as well as using her PREC to make a loan to her husband that was registered as a mortgage against their Vancouver home.
The BCFSA issued a news release about the couple’s conduct and penalties on Tuesday.
“These actions show a disregard for consumers who deserve to be represented by licensed real estate professionals,” said Jon Vandall, the BCFSA’s senior vice-president of compliance and enforcement, in the release.
“When someone offers unlicensed services, they are implying or claiming they are something they are not, and this leads to consumer risk. Ignorance of (B.C.’s Real Estate Services Act) is no excuse. BCFSA is here to inform and protect consumers and ensure only licensed operators provide real estate services in B.C."
