Sale of B.C. home without owner’s consent leads to $300K in penalties for real estate professionals

A fraudulent scheme that saw an unoccupied home in Richmond, B.C., sold without the owner’s consent has led to more than $300,000 in discipline penalties and costs for the real estate agents and brokers involved.

According to a notice from the B.C. Financial Services Authority (BCFSA), the Pacific Evergreen Realty agents and managing brokers involved in the 2019 sale were not complicit in the scam, but “they failed to take reasonable measures at multiple points in the transaction.”

The BCFSA says at least two men were involved in the fraud. One posed as the owner of the house and used a fake driver’s licence to get a notarized power of attorney, while the second posed as the attorney to conduct the sale.

The case has also led to both a civil lawsuit and criminal charges, and court documents suggest the Chinese businesswoman who owned the property is still fighting to get it back, four years later.

Consent orders posted by the BCFSA this week show that Pacific Evergreen agents Tracy Xiaomei Li, who represented the phoney seller, and David Chian Wei Yang, who represented the buyer, have both admitted to misconduct for their roles in the sale.

Li has been ordered to pay a $100,000 penalty and $7,000 in enforcement expenses, while Yang will pay a $50,000 penalty and $5,000 in expenses. They will both also be placed under enhanced supervision.

Their supervisors, managing brokers Lok Chi Annie Fong and Lo-Ming Lee must each pay $55,000 in penalties and costs for misconduct, while the brokerage has been ordered to pay $30,000 in penalties and expenses.

“The penalties reflect the severity of the licensees’ failure to meet their core responsibilities, including know-your-client obligations and duties to act honestly and with reasonable care and skill,” Jonathan Vandall, the BCFSA’s vice-president of compliance and enforcement, said in a written statement.

“Licensees must uphold their professional obligations, even if they are under pressure from their clients. Those who neglect their professional responsibilities will face discipline, especially where there is consumer harm.”

According to the BCFSA, Li did not carefully verify the seller’s ID or the power of attorney. She also obscured the timeline of the transaction by backdating disclosure documents and a fee agreement, the regulator says.

Meanwhile, Yang didn’t take the proper steps to investigate the suspicious circumstances of the deal or inform the buyer about all the red flags, according to the BCFSA.

CBC has reached out to Pacific Evergreen for comment.

‘An unlawful plan to harm non-resident owners’

An amended notice of civil claim filed this summer by the home’s original owner Yuan You fills in many of the details about what allegedly happened to her property on Colbeck Road.

Li, Yang and Pacific Evergreen are all named as defendants, although the claim states that they have settled the matter out of court on undisclosed terms since You first filed the lawsuit in 2020.

You’s claim alleges fraud, conspiracy, unjust enrichment and negligence by several people and businesses she says were involved in the sale. She’s asking for a B.C. Supreme Court judge to declare that she is the registered owner of the home, and to strike the title granted to the current owner.

In the claim, You describes herself as a businesswoman who currently lives in China. Property records show she bought the five-bedroom, six-bathroom home for $783,177 in 2004.

The claim alleges that a group of men named as defendants in the lawsuit “devised an unlawful plan to harm non-resident owners of property within British Columbia by fraudulently divesting them of their property.”

It goes on to say that the co-conspirators targeted homes that were either empty or only periodically occupied, and had no charges against title that could complicate a sale. You claims the men would break into houses they had targeted to make sure no one was living in them.

You has alleged that Richard Irvin Yeltatzie impersonated her and had a notary sign a power of attorney for Kieran Paul Yeltatzie, who then hired a real estate agent to sell the property. The sale was completed on Nov. 29, 2019 for $1.7 million.

At the time of the sale, You says the home was rented out, but the tenant was also in China.

Both Yeltatzies were criminally charged last year in connection with the sale; however, all charges against Kieran Yeltatize were stayed this week, court records show.

A warrant was issued for Richard Yeltatzie’s arrest in April after he failed to appear in court on charges including fraud, impersonation and using forged documents.

Neither Yeltatzie filed a response to You’s civil claim, and default judgment has been granted against both of them, with damages to be assessed at a future date.

The home was sold again in February 2020 for $2.15 million, property records show. You’s amended claim suggests the current owner should have been suspicious when she was able to buy the property for less than its market value.

The 2023 assessment puts the value of the property at $2.75 million.

You’s claims have not been tested in court.

Source link