FSRA Stakeholder Advisory Committee for Mortgage Brokering
Summary of the Meeting of November 24, 2021
Via Zoom
Stakeholder Advisory Committee members:
Daniel Andress – goeasy Ltd.
Kevin Cohen – AUM Law Professional Corporation
Evan Cooperman – Foremost Financial Corporation
Shubha Dasgupta – Pineapple Mortgage Corporation
Mark Kerzner – TMG The Mortgage Group Canada Inc.
Nick Kyprianou – RiverRock Mortgage Investment Corporation
Keith Lancastle – Appraisal Institute of Canada Inc.
Harley Redlick – H. Redlick Consulting, Inc. & Dominion Lending Centres Inc.
Susan Redmayne – First National Financial Corporation
Karim Talib – Lend At Ease, Inc.
Paul Taylor – Mortgage Professionals Canada Inc.
Edwin Weinstein – The Brondesbury Group Inc.
Joe White – Real Estate and Mortgage Institute of Canada Inc. (REMIC)
Board members:
Joanne De Laurentiis – Chair of the Board
Barbara Bellissimo – Director
Kathy Bouey – Director
Blair Cowper-Smith – Director
Joseph Iannicelli – Director
Brent Zorgdrager – Director
Management:
Mark White – Chief Executive Officer
Huston Loke – EVP, Market Conduct
Glen Padassery – EVP, Policy
Stephen Power – EVP, Corporate Services
Jordan Solway – EVP, Legal and Enforcement
Randy Nanek – Chief Financial Officer
Judy Pfeifer – Chief Public Affairs Officer
Nadiatou Fagbemi – Senior Manager, Mortgage Broker Conduct
Jennie Hodgson – Senior Manager, Mortgage Broker Conduct
Antoinette Leung – Head of Financial Institutions and Mortgage Brokerages Conduct
Thera Medcof – Senior Manager, Life Mortgage Brokers Policy
Corporate secretary’s office
Ligia Simoes – Assistant Corporate Secretary
Demola Oloyede – Board Administrator
Clint Savary – Contingent Worker
General comments
The Chair welcomed everyone to the meeting and all parties introduced themselves. The Committee is generally supportive of FSRA’s approach, noting that it has been collaborative and that efforts have been made to connect with the sector. The Committee underscored the importance of reducing regulatory burden where possible. It was noted that a number of initiatives can be pursued to aid the sector including regulatory harmonization across Canada, enhanced enforcement measures, and increased education for Brokers and consumers.
The Committee also reflected that tiered licensing would be a valuable initiative as not all brokers have the same experience or skill set. Providing a tiered licensing system will guide consumers in making better choices and ensuring they are well informed respecting their mortgage broker’s experience. FSRA is continuing to evaluate this approach and will meet with industry professionals to improve licensing and the Code of Conduct so consumers may be able to receive better service and find more appropriate, professional brokers.
The Committee noted that more than 50% of consumers do not understand compound interest and they question how to best communicate and educate consumers. The Committee and FSRA agreed that enhanced financial literacy and better communication with consumers is necessary. It was suggested that an improved Code of Conduct along with building greater awareness for consumers is an important next step for adding Broker value to consumers.
The Committee noted that consumers often act based on media messaging rather than seeking a solution specific to their needs. The Committee also noted that while improved education may add value for Brokers, there remains a risk gap because big banks are not required to use registered/ educated mortgage professionals.
Feedback on F2021-2022 Draft Priorities and Business Plan
The Committee provided feedback with respect to FSRA’s F2021-2022 Draft Priorities and Business Plan. It reflected that the priorities clearly indicate that FSRA has listened to the sector. The Committee is supportive of burden reduction and noted that dual regulation will be problematic for the sector. Smaller organizations will not be able to keep up with the regulatory costs required under an OSC regime. The Committee advised that it would prefer to be regulated only by FSRA.
The Committee also noted that it is supportive of the transition to principle-based regulation. FSRA should actively seek exemptive relief. Reviewing the Mortgage Brokerages, Lenders and Administrators Act is also important and the Committee would like to see FSRA support the next steps of that review.
FSRA should also consider that AI-based underwriting is in the near future. Other technology to consider are tools that connect to the Canada Revenue Agency and employers. This will ensure accuracy in verifying income and thus reducing fraud.