Ontario’s real estate regulator has taken control of one of the province’s largest brokerage firms – iPro Realty Ltd. – and is shutting down its operations, alleging it discovered cash shortfalls of more than $10-million in the firm’s consumer deposit and commission trust accounts.

The Real Estate Council of Ontario, or RECO, announced Thursday that iPro will remain in operation until Aug. 19 but that its owners had entered into an agreement to wind up the brokerage at that time. Any home-sale transactions that are in the middle of being processed will continue as usual, but any commission payments or other claims will be handled by RECO going forward.

RECO said it identified “a significant shortfall” in iPro’s accounts. “This is a serious breach of iPro’s responsibilities under the law and to its consumers and agents,” it said in a statement.

The shortfall was initially more than $10-million, and has since fallen to about $8-million, RECO said. Regulations require brokerages to separate trust account funds from regular business funds.

According to RECO registrar Joseph Richer, iPro’s leadership advised the regulator of the account shortfalls ahead of a scheduled inspection.

“We have not yet confirmed the number of consumers or agents affected,” Mr. Richer said in an e-mailed statement.

In a Q&A on its website, RECO urges customers whose deposits were held by iPro to ask their real estate agent for assistance. The document also provides information about how customers can file an insurance claim with the regulator, which protects consumer deposits in real estate transactions.

RECO said there are about 2,400 agents employed by iPro, which has 17 offices in Ontario: five in Toronto, two in Mississauga and one each in Brantford, Burlington, Orangeville, Georgetown, Milton, Bradford, Brampton, Baysville, Woodbridge and Pickering.

Real estate salespersons and brokers with iPro were still racing to piece together what was going on late Thursday afternoon.

“I heard about 10 days ago that iPro is going to be closed and transferring to somebody else, the founders were going to retire,” said Teuta Guci, one of iPro’s top-performing agents.

Some iPro realtors told The Globe and Mail they had been invited to a Zoom meeting with iPro founders Rui Alves and Fedele Colucci, who outlined a plan that would allow them to transfer to a new brokerage called iCloud Realty Inc. by Aug. 18.

Mr. Alves and Mr. Colucci did not respond to requests for comment.

In its website Q&A, RECO said iPro has made arrangements with iCloud Realty to assume all of iPro’s locations and any of its agents who wish to transfer there.

“I don’t have anything bad to say about either of those two gentlemen. … I never experienced even a hint of any irregularity,” said Erik Liscio, a broker with iPro who has worked with Mr. Alves and Mr. Colucci for 30 years, back to when the brokerage was part of Sutton Group, before it became independent in 2010.

The new iCloud brokerage and its sub-branches are all registered with RECO by Christopher Regimbal, who was a broker/manager with iPro before the creation of iCloud.

RECO confirmed that iCloud had taken possession of some of iPro’s assets, including building leases. The Toronto Regional Real Estate Board sent a bulletin to its members saying that fees associated with transferring from one brokerage to another would be waived for iPro members trying to find a new home.

Gurpinder Gaheer, realtor with iPro, said the only sign of potential money trouble he could recall came last year when the company switched customer-relationship management software providers from popular industry standard kvCORE to a cheaper no-name solution.

Mr. Gaheer also didn’t hear about the shutdown from iPro, but from another brokerage during a discussion about a potential home-sale transaction. “They said, ‘We want you to join our brokerage,’ and I told them I’m with iPro and they said, ‘Don’t you know iPro no longer exists?’ That’s how I found out,” he said.