Real estate agent submitted 'falsified' financial information on mortgage applications, B.C. regulator finds

A real estate sign is pictured in Vancouver, B.C., Tuesday, June, 12, 2018. THE CANADIAN PRESS Jonathan Hayward

The agency that regulates real estate agents in B.C. has cancelled the licences of a man and his personal real estate corporation after he admitted to using an unregistered mortgage broker and submitting "falsified income and savings information" on two mortgage applications.

Jin Luo admitted to the misconduct in a consent order proposal submitted to the B.C. Financial Services Authority. The BCFSA accepted the proposal, a redacted version of which was published on its website this week. 

Luo met the unregistered mortgage broker – referred to throughout the document as "Individual 1" – at an open house. He did not take any steps to verify Individual 1's registration, according to the consent order.

"J. Luo did not know Individual 1's last name, knowing him only ever as 'Jay,'" the document reads.

According to the document, Luo paid Individual 1 a total of $25,000 for assistance on two mortgage applications related to Luo's personal properties.

Both applications were made in late November 2015, the consent order indicates. The first was an application for a new mortgage to support Luo's purchase of a home in Vancouver for $2,183,000, while the second was to refinance a different property, also located in Vancouver.

Luo provided financial documents to Individual 1, who provided information to registered mortgage brokers, who then made the applications to lenders.

In both cases, the document indicates, Luo did not know the registered mortgage brokers and did not provide them with any financial documents.

However, both mortgage applications were submitted with "fraudulent documents" created by Individual 1, according to the consent order.

The first application "falsely indicated J. Luo had a savings account balance of $850,000 and an annual income of $256,961," the document reads.

The second application also falsely claimed Luo's annual income was $256,961, but this one claimed only $180,000 in savings and investments.

In the consent order, Luo admits that his use of Individual 1's services constituted professional misconduct and "conduct unbecoming," as defined by B.C.'s Real Estate Services Act.

Luo acknowledges engaging in "deceptive dealing" and failing to uphold his duties to act honestly and with reasonable care and skill under the RESA.

He also acknowledges that he knew or ought to have known that Individual 1 was not a registered mortgage broker.

As punishment for his misconduct, Luo and his company agreed to have their licences cancelled and to pay $5,000 to the BCFSA for "enforcement expenses" within six months of the date of the consent order.