Compliance in real estate is not static. It evolves as risks evolve, as regulations mature, and as expectations change. As an industry, we improve not by avoiding these conversations, but by having them openly and constructively.
At Century 21 Heritage Group, we recently completed our first audit by FINTRAC. While audits are never welcome, we believe there is value in sharing what we learned — not just for our own organization, but for brokerages and agents across the industry.
This was our first FINTRAC audit. Like many brokerages, our systems were developed by learning from:
Peer brokerages within our network
Industry discussions and shared experiences
Guidance and resources from our associations, including
Canadian Real Estate Association
Toronto Regional Real Estate Board
Ontario Real Estate Association
During the audit process, FINTRAC was clear that many commonly relied-upon industry resources do not necessarily align with their internal expectations.
That gap is important. Brokerages are actively trying to comply, investing heavily in systems and training, yet are often doing so without real-world examples or clarity that reflect how transactions actually unfold in practice.
While FINTRAC requires brokerages to establish and maintain effective compliance policies, there is no practical handbook provided by FINTRAC that outlines exactly how those policies must be implemented within the day-to-day realities of real-world brokerage operations.
FINTRAC’s mandate is preventative. Their focus is on identifying transactions that may warrant further review by authorities, even where no crime is known or suspected to have occurred.
Our audit reinforced an important reality for all brokerages and agents:
Risk indicators are not proof — but they must be treated seriously, documented carefully, and escalated when uncertainty exists.
When assets, clients, or transaction characteristics fall into higher-risk categories, the threshold for reporting becomes more sensitive. This is an area where judgment, documentation, and escalation protocols must be exceptionally clear.
Every transaction must be assessed and, where appropriate, investigated on its own merits—because even if an agent’s documentation is incomplete or untruthful, the brokerage still has an obligation to dig deeper, look for additional red flags, and escalate concerns when uncertainty remains.
Random file reviews alone are no longer sufficient; compliance oversight must be risk-based, proactive, and responsive to emerging indicators within each transaction.
Century 21 Heritage Group is known for a high level of agent support, training, and systems. In 2025 alone, we were honoured with seven awards for our training and technology programs. – https://c21hg.com/training/
Our compliance framework includes:
A FINTRAC course embedded into our training programs
Mandatory use of Fintracker, which we believe is best-in-class for transaction compliance
Ongoing education and escalation pathways for agents
However, one of the clearest lessons from this audit is a simple truth:
Any compliance system is only as strong as the information entered into it.
In this case, an agent did not provide complete and accurate information required to properly “Know the Client.” That agent no longer works with our brokerage. There was no intent alleged, but the absence of complete information limited the ability to assess and document risk appropriately.
First and foremost, it is important to be clear about what occurred.
The administrative monetary penalty imposed on our brokerage arose from the timing and assessment of one Suspicious Transaction Report (STR). While an STR was ultimately submitted, FINTRAC determined that it should have been filed earlier based on its interpretation of risk indicators. We are currently appealing this determination.
We have been advised by law enforcement that no crime was committed, and there was no finding of money laundering or terrorist financing activity.
A key takeaway for our industry is this: understanding which property types may be considered higher risk — regardless of whether any wrongdoing is apparent — is critical. Transactions involving those asset classes should automatically trigger enhanced review and clear documentation of the risk assessment process.
We have appealed this decision, as we believe the monetary penalty imposed does not appropriately reflect the circumstances of the transaction — particularly given that an STR was ultimately filed and no criminal activity was identified.
Our experience should not be viewed in isolation. It highlights a broader issue facing the real estate industry:
Compliance expectations are evolving
Risk tolerance is narrowing
Brokerages are expected to make judgment calls with limited standardized guidance
This creates a responsibility — not just for brokerages and agents, but for the industry as a whole.
We believe there is an opportunity here for:
Greater collaboration between brokerages
More transparent sharing of audit learnings
Constructive feedback to boards and associations
Stronger, more practical FINTRAC-aligned guidance tailored to real estate transactions
Compliance improves when knowledge is shared.
We encourage broker-owners and agents alike to:
Learn from each other’s experiences
Treat uncertainty as a reason to escalate, not hesitate
Provide feedback to industry bodies when guidance falls short
Foster cultures where compliance questions are welcomed, not avoided
FINTRAC compliance is not about avoiding penalties — it is about protecting the integrity of our industry and the trust placed in us by the public.
We respect Canada’s anti-money laundering framework and the role FINTRAC plays in protecting the financial system. At the same time, real progress comes when regulators, associations, brokerages, and agents move forward together — with clarity, collaboration, and practical understanding.
We are, and will remain, a solution-oriented brokerage. We will continue to provide exceptional service in helping clients buy and sell real estate, and we firmly believe in the importance of truly knowing our clients. At the same time, the expectations placed on brokerages today increasingly resemble investigative mandates, yet there is no clear, consistent, and transparent operational framework explaining how those expectations should be applied in everyday real estate practice. Real estate professionals are trained to facilitate transactions, advise clients, and manage risk within our scope — we are not law enforcement investigators. If the industry is expected to carry a greater compliance burden, then clearer implementation standards and practical guidance must evolve alongside those expectations. That is how we protect both the integrity of the system and the professionals working within it.
If reporting were centralized and standardized under a FINTRAC-managed system, real estate professionals could focus on accurate disclosure while trained investigators assess risk using national-level intelligence tools.
Eryn Richardson
Managing Partner
Century 21 Heritage Group
📧 eryn.richardson@century21.ca
📞 905-960-7355