The Ontario legislature moved improve consumer protection with the successful third reading of the Mortgage Brokerages, Lenders and Administrators Act, 2006.

“Obtaining a mortgage to buy a home is likely the biggest financial commitment families will make,” said Finance Minister Greg Sorbara. “This legislation protects Ontarians by improving the accountability of the industry, and modernizing financial services regulation to support a new generation of economic growth.”

The new legislation will require individuals and businesses who deal in mortgages to be licensed by the Financial Services Commission of Ontario (FSCO). In addition, brokerages will be required to have a Principal Broker who will oversee conduct and act as the chief compliance officer for the organization. Other provisions in the legislation modernize FSCO’s enforcement powers and allow for improved standards of practice, including enhanced disclosure of remuneration and conflicts of interest.

Consultations on the proposed regulations and the education review are also continuing. The new legislation will be proclaimed once the regulations and the education review are finalized and when members of the industry have been given an appropriate period to understand and comply with the requirements of the new Act.

The government and FSCO will continue to keep the industry informed on the progress of this important initiative as it moves forward.