Freezing the accounts of several real estate brokerages in Mississauga and Brampton has had a “devastating” impact on clients and should be appealed, lawyers say.

Earlier this month, four Save Max brokerages and two residents from Mississauga and Brampton were suspended and put on freeze orders by the Real Estate Council of Ontario.

The board says an investigation revealed some $2.7 million was “disbursed unlawfully” from brokerage trust accounts following a complaint.

But lawyers for the brokerages say the freezes were “unwarranted,” and that the allegations “have caused serious harm to Save Max’s business, agents, brokers, and clients.”

The decision has had a “devastating impact” on Save Max, the appeal states, including “immediate and severe operational, reputational, and financial harm,” according to an appeal of the decision filed to the RECO.

Between 100 to 150 active listings have been frozen, and some 400 registered real estate salespeople have since left brokerages across the broader Save Max network, according to the appeal.

“Contrary to the rumours circulating about what is in Save Max’s trust accounts, no funds are missing,” law firm Hutchison Robitaille LLP said in a statement sent to INsauga.com.

The board says funds held in trust for real estate sales were instead used for loan payments, property management fees, taxes, credit card balances and vendor services.

And while the appeal says investigations by the RECO did find “incorrect disbursements,” most were “reversed promptly within 30 days – a number of them within 24 to 48 hours, and one within a matter of minutes.”

The largest of the disputed transactions was a transfer of $700,000, which was “reversed the next day,” according to the appeal.

In the appeal, Hutchison Robitaille says there is no basis for the orders, and calls for the board to revoke them and “that the costs of this proceeding be awarded” to the appellants.

The board named Save Max Real Estate Inc., Save Max First Choice Real Estate Inc., Save Max Supreme Real Estate Inc., Save Max Ace Real Estate in its findings.

Brampton broker Raman Dua and Nidhi Dua of Mississauga were also named as brokers of Save Max First Choice Real Estate Inc.

In a post on social media, Dua said he is “cooperating fully and proactively addressing each matter raised.”

“There is currently a freeze on real estate transactions across our four brokerages pending the completion of regulatory proceedings,” Dua said. “We understand this creates uncertainty, and we are working urgently to resolve these matter

To access their funds, individuals must now go through the insurance claims process, the board says.


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