A former Ontario mortgage broker has settled with regulators after using an unlicensed referral agent to handle client intake—a practice that exposed borrowers to serious financial and legal risks. Paramjeet Kaur agreed to pay $40,000 to the Financial Services Regulatory Authority of Ontario (FSRA), down from the initially proposed $85,000 penalty. The case reveals how unlicensed intermediaries can manipulate mortgage applications, falsify borrower information, and leave clients unprotected by errors and omissions insurance. In one instance, a Hamilton borrower discovered her registered mortgage exceeded what she’d agreed to after never meeting her broker in person. The settlement reflects FSRA’s intensified enforcement efforts—the regulator issued 100 enforcement actions in 2024–25, up from 65 the previous year. Industry experts warn that as market volumes recover, fraud risks will escalate, urging mortgage professionals to maintain heightened vigilance. For GTA homebuyers and refinancers, this case underscores the importance of working directly with licensed brokers and verifying credentials before signing any documents. Understanding these regulatory protections is essential in protecting your financial interests throughout the mortgage process.
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