Real Estate Developer and Director Ordered to Pay Nearly $100K for Failing to File Disclosure Statement and Hold Funds in Trust

Halcyon Point Development ULC and its director Dale Tortorelli failed to provide purchasers with a disclosure statement that would have explained the nature of the development, and did not hold deposit funds in trust.

Vancouver, August 14, 2024 – BCFSA has issued an administrative penalty against a real estate developer and its director for marketing a development property without filing a disclosure statement and failing to hold purchaser funds in a trust account, contrary to the Real Estate Development Marketing Act (“REDMA”).

Halcyon Point Development ULC (“Halcyon”) and Dale Tortorelli are jointly and severally liable to pay:

• An administrative penalty in the amount of $20,000; and
• $79,192.47 in enforcement expenses.

In 2016, Halcyon and Tortorelli marketed a development property in the Arrow Lakes area in B.C. to purchasers seeking to acquire a 1.3 acre portion of the property and build a house on that portion. Halcyon and Tortorelli did not prepare or file a disclosure statement before marketing the property. When the purchasers provided Halcyon and Tortorelli with $80,000 in deposits, they did not hold the deposit funds in a trust account. Instead, Tortorelli deposited the funds into his various business accounts.

Consumer harm was a key factor in determining disciplinary measures. The purchasers’ plans to have ownership of a portion of the property were thrown into disarray because Halcyon and Tortorelli did not provide them with a disclosure statement as required. A REDMA disclosure statement would have made the purchasers aware that there was no subdivided portion of the property available for them to purchase in fee simple, also known as freehold interest.

The developer’s failure to hold the purchasers’ deposits in trust also created harm – those deposit monies were not available to be refunded when it became apparent that the portion of the property was not available to be acquired in the way the purchasers had intended, leading them to pursue civil litigation in order to receive their funds.

BCFSA is responsible for enforcing developer requirements under REDMA and takes action, including ordering financial administrative penalties, to protect consumers, encourage compliance with REDMA and regulations, and deter future misconduct.

Read the sanctions decision for full details.

About BCFSA

BC Financial Services Authority is the province’s regulator for the financial services sector that helps to protect British Columbians during some of the most important financial decisions of their lives. As a Crown agency of the Government of British Columbia, BCFSA oversees credit unions, trust companies, insurance companies, pension plans, mortgage services, real estate services, real estate development marketing, and money services businesses. BCFSA also administers the Credit Union Deposit Insurance Corporation of British Columbia (“CUDIC”). BCFSA’s mission is to instill confidence in the financial services sector by focusing on the safety and soundness of regulated entities and consumer protection.

Media Contact:
Lindsey Norris
Communications Manager, [email protected]
Visit: www.bcfsa.ca