Episode Transcript
[00:00:00] Speaker A: They called it one of the biggest real estate scandals Ontario has ever seen. IPro Realty, a giant brokerage with over 2,400 agents and 17 offices, suddenly collapsed when regulators discovered up to $10 million missing from its trust account. Buyers lost deposits, agents lost commissions, and the industry was left reeling as police opened up a criminal investigation. It should have been the end of the story, but now it looks like the same guys are back in business.
Mark Morris is a real estate lawyer here in Ontario. He owns LegalClosing CA and he joins us for a second time today, the first time with Paul Micucci, earlier on the same topic on the IPRO scandal which we're talking about today. Thanks for joining us, Mark. I appreciate it.
[00:00:53] Speaker B: Oh, it's a pleasure. Thank you again for having me back. I really enjoyed the first interview. Thank you.
[00:00:58] Speaker A: Well, as I kind of outlined in the intro, you know, I pro was probably Ontario's largest brokerage scam in history. Maybe I'm wrong about that, but certainly it drew the attention of the authorities.
And so sort of as a follow up, first of all, why don't you take us through what the scandal was and what it meant to consumers at the time that it occurred?
[00:01:21] Speaker B: Yeah, well, I think you're right, by the way, in the way you classified that because you called it a scam. It's certainly not the biggest scandal, it's certainly not the biggest bankruptcy, it's certainly not the biggest blow up.
But I do think it's the biggest scam, meaning that it was born of intention and as a result has criminal elements, regulatory elements, and has really shaken the industry to its core. So just to remind your audience as to what has transpired here, there was a large brokerage of about 2,500 agents, which is about as big as they come in Ontario, all of whom belong to this group called IPro Realty.
And it turned out that I Pro Realty was effectively not guarding its trust fund appropriately. So to back up and to give context, all lawyers in Ontario and all brokerages in Ontario are entrusted with something called a trust account, which is an account for other people's monies. And as you can imagine, being an account for other people's moneys, it has to be given and treated with the heightened diligence that comes along with dealing with other people's monies. These are not monies that you've earned. These are monies you're holding for other people. So in the context of real estate, there's two different types of monies that a brokerage regularly Holds. The first is the monies that it is holding by way of a deposit for transactions that have not yet occurred. And as you can imagine, with 2,400 agents, there's a whole lot of people, because you sign an agreement of purchase and sale, and it usually takes about three months to close.
There's a whole bunch of people who have a whole bunch of deposit monies sitting in that trust account.
The second monies that are usually held in trust are those monies to pay out the agent commissions, because as you can imagine, agents themselves have to wait until the day of closing for those monies to be earned. And then once they're earned, there's a period of time where ultimately they have to be paid as well.
And what happened here is that there were trust irregularities that took place such that there was not sufficient money within the trust account to account for all of the people's money who ultimately entrusted IPRO to monitor and protect those sums.
Now, that in itself is a scandal.
It's born of more than inadvertence, if you know the way trust accounts work, particularly for large organizations. I've run large law firms in the past, and my law firm is now a midsize law firm.
Again.
You know, we do daily reconciliations. We're meticulous about our accounts. And the reason we do daily reconciliations is actually not so that I can come on a show like this and brag, but rather because if you have a single issue and you discover it 30 days later, it's a headache par excellence. You want to know about these things. You want to be keeping active tabs. And in fact, we tend to pay a lot of money for people whose sole job it is to monitor the trust account and make sure that every dollar that's flowing is. Is being treated seriously. And that would be the expectation of an I pro or a right at home or one of these larger brokerages that they were doing more than the mandatory minimum requirement of reconciling once every month. But they were on it every single day.
So they. The fact that money was missing was itself a regulatory failure in that firm. It turned out to be more than that. And we'll talk about it, but that is not the essence of why it is. We are still speaking about IPRO because people will be. Not everyone is honorable. And if you take 100 people in a room, you're going to have people who are 100% honorable, and you're going to have a given percentage of people who are not. And the regulatory body's purpose in this case, the regulatory body in real estate is called rico. The Real Estate Council of Ontario is to ensure that all actors, whether good, evil, malevolent, negligent or otherwise, are properly accounting for their trust obligations.
In this instance, ricoh, through an audit, discovered that there were discrepancies in the trust account.
And the problem that took place here is that Ricoh did not act with dispatch.
In fact, many people believe that Ricoh acted with anything. But Ricoh took three months in order to properly identify the issue and shut down the brokerage.
Those three months, people had no idea that this was taking place, even though the regulator did, continued to put new monies into the trust account, continued to operate with the trust that they were being properly overseen, even though everyone realized that was not the case at rico. That is to say.
And when they shut down the brokerage, they did so in the most inappropriate of ways.
Specifically, they gave what was by any stretch, a slap on the wrist to people who embezzled trust funds.
Turns out that, you know, this was known. It turns out that this was not negligence. This had been taking place for a long period of time.
[00:06:46] Speaker A: It feels almost Ponzi. Ponzi scheme. It's totally a dollar.
[00:06:52] Speaker B: It's absolutely a Ponzi. And it's worse than a Ponzi because it's an involuntary Ponzi. It's a Ponzi where you cannot tell your part of a Ponzi scheme, as opposed to someone who says, hey, you should invest in this, and then you're duped. And you didn't realize it was a Ponzi scheme. In this instance, you were told actually.
[00:07:08] Speaker A: The easiest Ponzi scheme to execute because you don't have to explain anything to anybody.
[00:07:14] Speaker B: Correct. You just take the money. And so what happened here is that RICO was negligent because it took three months for it to actually take action. When it took action, its action was wholly deficient. The regulator at the time, who has since been relieved from his duties as a result of this, basically said, you will be allowed to voluntarily withdraw yourselves, the two owners of IPro, from the profession. You'll be allowed to claim semi retirement, which is what they did, and then struck a deal where they were allowed to transfer the brokerage's underlying assets to an entity that was, for all intents and purposes, clean and thus obfuscate the fraud that took place.
[00:08:04] Speaker A: Originally. They reported there was like, I think, under $8 million that was in discrepancy here. And then it was 10.5 million. And then shortly thereafter, we're finding out that it's closer to 24 or $25 million.
So now has the money been restored to any trust fund or these consumers out their money?
[00:08:26] Speaker B: So let's be very clear firstly as to the numbers. The 24 million is a sensational number, not because it's not accurate, but because $24 million is, is in play. But that's not the number that is missing. Okay, for the purposes. And so when we hear 24, $30 million, that was the total amount of money that was fungibly used within this system, but some of it was paid back. So it's not that there's $24 million in losses. We don't know what the total amount of losses are. We'll find that out when the audit comes out and we'll talk about that. It was mandated by the province.
But what is important about the number question happens to be the number eight, because 8 million is the mandatory insurance that Ricoh demands that brokerages maintain for the purposes of frauds. What that means in English is that $4 million covers commissions and $4 million covers the public.
So whether it be 10 million, 24 million or 100 million, anything above 4 million that deals with consumer deposits is a loss that is not covered by insurance. We don't care up to $4 million. I mean at that point the trust account will be made whole. If it's just $4 million that are missing, no problem. Insurance pays the 4 million. There's enough money to pay everyone back. But if there's $10 million in losses on the consumer level, not the commissions, then you're looking at a six million dollar discrepancy that needs to be made up from somewhere.
Now, as it turns out, the realtors of Ontario, to their credit, are sickened by what happened. They're sickened by what happened due to self interest. I'm not trying to say that they're altruistic beings that ultimately love this. I'm saying to you, they realize that their own credibility is on the line here.
Because if a single consumer loses a single dollar putting money into a brokerage in Ontario, whether or not the insurance covers it or not, then we all collectively as a profession have a credibility issue that we will not overcome.
[00:10:35] Speaker A: And everyone that makes sense. No, no. I mean there's. You don't want to create suspect in any industry, especially one with high priced, important purchases like homes.
[00:10:44] Speaker B: Precisely. And that's the reason that Ricoh took an approach which I think is actually quite smart. First smart thing they did in this Entire thing where they said for commissions, everyone has to wait, we're going to do it pro rata, everyone's going to make their submissions, people are going to take their haircuts, people will probably come out 40% on the dollar, whatever. But that's the agents for ontarians that have their deposits.
These things continue in the normal course. We will pay them out. We will just get it paid. How will they do it? I don't know. There may be a special levy that takes place on Realtors at the end of this. There may be just. They have to use. They have a $50 million, I think retained earnings in their, in their statement. Maybe they'll use that, who knows? But one way or the other, Ricoh, on behalf of the industry is seemingly not allowing consumers to lose a penny beyond the insurance mandates specifically because if they start doing that, then deals start falling aside. And if they fall aside, then as you can imagine, it's much more than the deposit your whole agreement of purchase and sale. Yeah.
[00:11:42] Speaker A: If people's money vaporizes, the home deals go away, the home deals go away. That just dominoes and dominoes.
Okay, so now it begs a question. What were they doing with the money?
[00:11:52] Speaker B: What was, what was I pro doing with the money? Yeah, well, all right, so, so this is all conjecture. Let me, let me state that this. Okay, let's, let's just.
[00:12:03] Speaker A: No one knows, let's say allegedly this could happen. Let's be hypothetical. No problem.
[00:12:07] Speaker B: It's actually, you know, that's probably the most interesting quote. I've been interviewed on this a couple times and I. That's probably the most interesting question that hasn't been asked. What did they do with the money? Because truthfully, I mean, they had a nice house or two and they, I think there was like some evidence that they may have had a yacht of some sort and everything else. But they weren't living extravagantly the way that you would if you were just embezzling. In fact, there's reason to suspect, I'm not saying to you this is the case, but there's reason to suspect that their basic business operation was not sustainable. So to be clear, there was a new right at home, pioneered a new model for the industry.
And the new model, it used to be the case that everyone used to divide out their commissions 60, 40. So if you are a REMAX agent, you would give 40% to the brokerage and you'd keep 60.
Then over time, particularly as technology kind of came in, those splits changed to, I don't know, 80 20, 90, 10. And then this new model came into the industry that had never been there before.
Right at Home pioneered it where they said we're going to take $295 a deal regardless of what it is you do. And we're going to take $99 or $169 per month. And what we're going to do is we're going to be such nimble and good operators. We're going to give you no training, we're going to give you nothing else. They give training now but initially we're bare bones. We're going to basically be the brokerage. We will facilitate this. We'll have all and we'll do in volume will give us net profit. And that's, that's acceptable. By the way. You have to be a really, really, really good operator. And by the way the operators of Right at Home were really, really good. Howard, Drew, Karsh and others, mad magicians at what they did. And they operated properly at these rates which people said they could not operate at. They couldn't understand how they were doing this business. And I feel very much for them. I started up a law firm called Access Law which was based in Walmart. We opened up 13 by the time I sold it, we opened up 13 law firms in Walmart and we were doing volume based law and I was doing wills for $149 a pop and people were like, how do you make profit on this?
[00:14:22] Speaker A: I just had a family member finish their will at that very Walmart.
[00:14:29] Speaker B: Okay, so that was my, that was, that was, I start, I co founded that with my, with my partner who's still running it, Lena Koch. And you know, we did this in volume and it was very hard to make a profit but eventually a profit was made once we actually figured out the machinations of quality and assurance and process and order and that's much, much harder than you can imagine. But right at home did it access the law did it. People can do it.
I pro decided to compete in that space. This is to your question. I pro decided to compete in that space.
But I don't think people quite understand how hard it is to streamline operations. Operations are the hardest thing in the world. And if you have ever been in business you will know doing something in volume and particularly in commoditized services where marginal costs don't fall at scale. I know that's Yiddish, but basically what it means is if you are manufacturing a physical device, if I'm manufacturing this, If I produce 10,000 of them, the cost is $100, but if I produce a million of them, the cost is $5. Because marginal costs, the cost of every item falls at scale. But with professional services, marginal costs don't fall at scale. You still make the same profit, but there's no marginal cost differentiation because you have to tack on additional people and quality assurance.
[00:15:45] Speaker A: I was going to say, everything requires that process of somebody actually physically doing that work.
[00:15:51] Speaker B: Exactly. So 2,400 agents could make for a very profitable business if you have a Howard Drewkarsh who's ultimately operating and driving operations. And there you go. But for every Walmart, there's a Sears, and Sears did not have their operations down where Walmart did. And we see what the difference is. And actually, if you are I pro.
You can see based on how many people had to lend money to the operating company over time, that they weren't running efficiently, certainly they weren't running profitably. So if you're asking where the money went, yes, to some degree, I'm sure while they were sitting there and delving into the trust, they were paying themselves handsomely. And I'm sure that it went to homes, and I'm sure that it went to renovations. And I'm sure it will be discovered that they had yachts and everything else, but in terms of siphoning $30 million, that's not, it seems what was going on.
[00:16:44] Speaker A: They didn't seem to be living that.
They weren't living with stolen money. They were just funding.
[00:16:49] Speaker B: They were operating their business because they could not operate it without it, which itself is a sign of failure. You know, business people, you know, if you're, if you don't have something that's working, shut it down. Shut it down. Or alternatively, borrow your money and put your. Do what we all do, right? You can't embezzle money. Take it from someone else. But to your question, what happened to the money?
I think we're going to find it's a mixture of both. I think they were living on it, though, not living too large, although they were living large, combined with the fact that they were using it for the operations of the business.
[00:17:23] Speaker A: Now, RICO does these inspections.
This was a routine one. Or do you.
I think that my question is, if they do these inspections every four years, is that enough?
Is there more oversight needed? Now Rico's saying that they're going to, I guess, insulate and be better enforcers, better inspectors, and that they're going to play a heavier role based on this specific incident.
But are they? And how will they think about this for a second.
[00:17:56] Speaker B: So you remember how I was just talking about operations of a business.
Operations of a business require detailed analysis of things that actually make things better.
One thing that would make RICO better is not their attestation that they're going to be more diligent in their audits, rather an acknowledgement that brokerage A is not brokerage B.
An acknowledgement that legal closing CA, which is my firm and does 10 deals a day. Well, we don't. That's humble bragging here for the purposes of this pod, but truthfully we do between 6 and 10, so we do between 6 and 10 deals a day is perhaps deserving of additional audit track.
That a person who does two deals a month is not because LegalClosing CA presents a systemic risk, whereas that person.
[00:18:47] Speaker A: Does not and well, certainly not inspected over that period of time.
Yes, I would agree you should be inspected more often, Mark.
[00:18:55] Speaker B: But if you think about it, there's a very easy way to do it for the purposes of RICO. Just do it by brokerage size. If you have 2,400 agents, there should be no excuse. There aren't that many. There should be no excuse.
Brokerages that hit 1,000 and more agents should be, should be audited on an annualized basis, whereas brokerages that have five agents perhaps can go through a four year audit track. And yet RICOH hasn't even discussed turning its attention to a bifurcated audit track which would accord with with the realities of the market today.
By the way, it's not just RICO law. Society is equally deficient on this.
Like I don't want to, I don't want to pretend that like I'm high and mighty and like my colleague Cartel and Bui just had an article written about them in the Toronto Life where they basically embezzled $9 million and have been living their life, their best life on client trust funds. Similarly, there's someone out in Brampton, a real estate lawyer who's gone ahead and purchased out $3 million from, from their trust accounts. And my suggestion to the law Society on that is, do not allow people to ultimately conduct real estate transactions if they don't have sufficient coverage per transaction. That is to say, if you're doing a $10 million transaction and Law Pro's mandated minimum is 1 million, make sure that you have excess for 10 million before you could take it on. Simple rule seems pretty obvious to me. There are ways of being smart about this that do not require us to say RICO, do a better job and start heavy hand of regulation. Just Bring it out there. There are better ways, there are smarter ways of approaching this. RICOH has, to date shown no evidence that they are thinking about these things. But then again, RICO has gone properly silent. They're pending the Denton's review. They're under the thumb of the minister. We haven't talked about any of these aspects, but this is a fallout of the scandal. And the high likelihood is that regulatory reform, internalized regulatory reform, is in the cards and that these matters will start being discussed as a viable mechanism as opposed to just saying, we're going to audit everyone more.
[00:21:03] Speaker A: So, Mark, these guys.
I'm sorry, I had their names in front of me in it, but Rui is so sorry.
[00:21:11] Speaker B: It was Rui something or another. And someone. I forget their names, too.
[00:21:14] Speaker A: Yeah, Ruiz does sound right. And before the end of the show, I will find it.
But essentially they were told, okay, guys, we'll give you early retirement and we'll do a further audit. And I guess they'll figure out what's going on there.
Meantime, they're able to open up iCloud, which seems to be doing the exact same thing.
[00:21:41] Speaker B: Well, let's be clear. ICLOUD is.
[00:21:45] Speaker A: I'm so sorry, what is the name of the new version?
[00:21:47] Speaker B: No, it is. It is called iCloud, which is sued to oblivion by Apple at some point. Which. Which, yeah, it shows you the haste in which they opened it up that they called it iCloud.
[00:21:57] Speaker A: I feel badly even saying the name out loud because I just feel like anybody from Apple right now in the legal department is going, okay, there were two.
[00:22:05] Speaker B: There were two different brokerages. I think it was Skybound and icloud that were opened up, and the fact that they were opened up and the fact that people who were involved in IPRO are involved in iCloud and Skybound is not really the biggest deal. That's not the biggest deal. Look, we're innocent until proven guilty. And there's a whole lot of people who work for IPro who probably knew nothing of the scandal. And we can't paint them all with the same brush. That's not the way justice works. If someone who was affiliated with IPro is forever tainted as a result of a scandal that they had no part of or no knowledge of, that is itself a manifest injustice. And there are a bunch of people who have opened up ICLOUD and who have opened up Sky, Skybound. And we don't know if they have been involved or not, although we suspect they were because of the sweetheart deal that was provided. But we don't know that yet. Fine.
That's not the scandal. The scandal is not that. The people who are not affected by the scandal are trying to reconstitute and, and do what they need to do and make a living and everything else begrudgingly. You gotta give people their due, let them have that. The scandal, the essence of the scandal here above all else, and we haven't touched on this, is that ricoh, in its brilliance, facilitated the underlying transfer of the value asset that is the brokerage members. So let me explain.
Every business, doesn't matter what business you're in, is valued on the basis of its future cash flow.
So if your future cash flow is expected to end in three years, then you will only get paid for the present value of three years worth of new cash flow. If you have 2,400 agents and your future is looking bright, then you will be. Then it's called the perpetuity. You're assuming that it's going to continue forever and 24 hundreds are going to generate the following. And therefore the present value of that is X. And that's how you value the brokerage.
[00:24:04] Speaker A: And it's usually at an x factor of 10 or whatever it is over.
[00:24:08] Speaker B: A period of time. It's usually an X factor of about one. To be very frank, for professional.
[00:24:12] Speaker A: Oh, is that right?
[00:24:13] Speaker B: In this industry, okay, it's different. Tech is about 8. In the normal thing, tech is about 8. Outside of the unicorns, manufacturing is usually about 4.
Things like insurance are about 2 or 3. Actually, 2 or 3. Insurance could be a bit higher, but professional services are about 1. Because there's no longevity of purpose. If Mark Morris goes away, legal closing is invalid, is not valued the same way. Because they are saying, right, okay, so that, that's the reason that it has low value.
Regardless, that's all interesting. We could talk about that another time.
What happened here is that the underlying value is the agents. And what Ricoh did is before they even explained that there was a fraud, they basically said, hey, every one of you that are agents of IPro, we are automatically transferring you to iCloud unless you opt out of the system in three days. Now, opting out of the system is not an easy thing for an active agent to do. They have to find a new brokerage, they have to fill out the forms, they have to be comfortable with their new contracts. It takes a month or two months to ultimately do this. And so what RICOH did in giving people three days, many of whom are on vacation, many of whom aren't following this, whatever, they facilitated the underlying value transfer from a infected firm called IPRO to a clean firm called iCloud. Clean until Apple sues them.
And that underlying value transfer means that ICLOUD is now sitting on the results of what was effectively a fraudulent enterprise. And RICO did this. RICO did this. RICO was the one who said we're auto transferring. They didn't say, hey guys, you guys only have three days and you have to find a new brokerage. No, they said we're transferring this. And there's reason to suspect that the principles of ICLOUD are related or maybe even guided by iCloud by IPro principles. Now I said we have to give them their due. That's fair. We can allow people to do and start their business.
[00:26:20] Speaker A: But what you're saying is an industry regulator can't be helping a failed company that has done something untoward with their trust funds and just allow them. Because even if, even if the their various brokers or signed on members took three days or five days when they made the transfer of that company to take on whatever investor was going to get behind them, they showed that investor the value of all of these brokers that were associated with them or all of these agents that were associated with them and that then gave them the basis for the value of their new business.
[00:26:58] Speaker B: Precisely. So that's exactly right.
And so it stinks to high heaven. I mean it just, it just stinks to a point where there was consequence. RICOH had to let go. Its director, the minister who is ultimately responsible, came in and said to hell with this.
And they gave strict instructions about the audit that's to take place. They mandated that that audit be public, which it will be when it is released.
It's let things quiet down a bit, which is good for everyone right now, but it will be released and then this will kind of spark back up again and RICOH will have to answer for its sins. It's just we're waiting to find out the full extent and report.
Quite frankly, the answering that they'll probably end up doing is a slap on the wrist as well. Which is to say they may have an overseer themselves, an ombudsman who you can complain to. That won't really do anything. It's just, it's just another layer of management. Truly what needs to happen is RICO just needs to be better at its job. Because whether it's the ministry or rico, this could have had, this is, this is a failure of people. And wherever those people are, whether they're at RICO Whether they're at the ministry, at a board level or anything else, anyone could have failed in their regulatory task. What we need to do in this country, Canada generally, is we need to take justice matters more seriously. When you rob trust accounts, you need to go to jail.
When you go ahead and you do something that is untoward, you should face customers consequences. Now don't get me wrong, I have endless criticism of the way the United States chooses to met out justice. I don't think it is justice in half the instances. But quite frankly, it goes the other way in Canada. You can't let people who are doing this go free because if you do, you're setting an example. I am currently sitting here. This is not an exaggeration. I'm just going to pull it up. Just. I have no idea. I haven't looked in anticipation of this interview. But right now in, in my trust account, I'm taking a look. I have $12,300, $12,300,000 sitting in my trust account today for today's transactions. There it is. It's right on my screen.
If they don't take this seriously, what stops me?
I know what stops me. Us. Us. Right, Right. What stops us?
What stops the nefarious actors who are lawyers and there are the same 2, 3% that infected I pro can infect anything.
What stops them from looking at the $12 million that's in their trust account and going off to Tahiti? Where is the hammer? And that's the question we need to ask.
[00:29:40] Speaker A: We see that in corruption.
We see that in widespread large corruption in this country all the time. Yes, we see it consistently. People that could, should or, or even be tried under a criminal charge for the things that they do in a fraudulent manner. I mean, we saw it happen in this province recently with a training program.
We've seen it repeatedly over and over again. And nobody goes to jail.
[00:30:08] Speaker B: Nobody goes to jail, by the way. Nobody goes to jail.
This is a problem of ossification of our systems. Do you know that only one person went to jail during the great financial crisis in the United States in 2008? One person.
One person was jailed.
[00:30:23] Speaker A: Right.
[00:30:23] Speaker B: The United States has their own problems. It's not like we, it's not like we're not facing. It's not like we're facing a system that's unique to Canada. There are other challenges too.
[00:30:32] Speaker A: But we, the King's Court exists in almost every democracy. Right?
[00:30:37] Speaker B: But we live in this country and it's on us to do better. And we piss poor. Do not care about justice. Now, to their credit, I'm a liberal. I am.
I usually support liberal causes, but. But to their credit, the Conservatives bring a lot of value to the table, particularly with regards to economic policies and particularly with regards to justice issues.
And the truth is that it's all well and good to actually give deference to rights and respects and everything else, but once you've exhausted that, you need a hammer. You need a hammer. And the Conservatives understand that. To their, to their credit, you know, there was more. There was more attention paid to this.
[00:31:20] Speaker A: I think that there is an outcry. I think we're seeing that on a regular basis right now.
I think that what has happened in Canada is certain polarity is going to fade away. For example, you just said that you're a liberal. I consider myself a conservative. We've had a nice discussion. We agree about the problem. We. We agree that there needs to be a solution, no polarity of politics involved. And I think more issues, by the way, my vote could be swayed. Go ahead and call me and make the right offer. But if we have more conversations that aren't polarized by political party or big party thinking, if we sit down over these issues, things like people committing crimes against a large group of people, people committing crimes against an industry, you know, people that we trust, like lawyers and brokers of our money.
Unless we start to really watch over that, there's going to be problems. And that has no political realm. That's all of us.
[00:32:24] Speaker B: That's correct. And you know what? There's so much overlap at a macro level between what the interests of everyone are. I'll give you a great example that I was involved in for the past, past two years.
So the immigration scandal that took place. So what happened was the emerald. The federal Liberals were incredibly lax with their immigration policy, negligently so.
And they allowed in endless reams of students.
And what the bad actors in Ontario recognized, Conestega College being the worst. And there's others that they basically had these fields of people in India, all of whom wanted permanent residency and all of whom could obtain it through a loophole in the system that allowed them to claim they were going to college. P.S. involved, you know, getting a haircut, literally a haircut, as long as they paid $75,000. So these guys were making off like bandits. They were abusing our immigration system. They knew they were abusing the immigration system. They made millions of dollars over the course of years, leading to disastrous effects in our real estate bubbles in Brampton's real Estate bubble particularly, and have led to a sea change in the way Canadians actually as a whole even see immigration where it's now no longer a net positive. For the first time in Canadian history.
I think both Liberals and Conservatives can easily come together on an issue like this and say, listen, immigration may be a greater good, but like hell we're putting up guardrails to ever allow something like that where we're taking advantage from a liberal perspective or we're taking advantage of poor innocent people and taking $75,000 away from the working people in the home. And Conservatives are saying, and like we're just letting anyone into this country fundamentally that to have no income or qualification. Well, we're aligned on the basic macro idea that immigration controls are important.
Right. And. And if you're able to.
[00:34:15] Speaker A: But on both sides. But on both sides of that fence. Now we all are having the same conversation.
[00:34:22] Speaker B: Correct?
[00:34:23] Speaker A: A mistake was made. We need to make sure that this doesn't happen. Not just for the sake of Canadians here now, for the sake of people coming to this country. You know the. I saw a recent report saying, and by the way, I don't love all reports and this one seemed a little fictitious, but the intent was there. There was a time where Canada was the top of the list of great places on Earth to live in. The top five. We're now under. I think we're at 35 on that list now. And that is because of decisions that we make like this that allow industries to steal from people or be disreputable because it's being covered up.
[00:35:06] Speaker B: But the one thing that I will. It's that plus economic malaise. I mean, we're going a bit off topic here.
[00:35:11] Speaker A: Exactly.
[00:35:12] Speaker B: But truthfully, and this is, this is a decadence that is ascribed not just to Canada, but also to the Western world as a whole. We are no longer economically productive as countries as compared to top economies.
When someone goes to China and sees the fact that they are about to introduce drone vehicles into their car dealerships and that within five years they're expecting those drones to be flying within major metropolitan centers and compares it as against the fact that we can't build a frickin LRT over 19 years and not even have a symbol of investigation, we are talking about an ossification of our economies which naturally leads into this. So what we have is a productivity crisis at its heart that is ultimately affecting the quality of life that we exist. There's an interesting article that came out and again this way off topic, but it's Interesting. It's an interesting article that just came out in the Atlantic that says China is a nation of engineers and America is a nation of lawyers. And the job of lawyers are to preserve wealth and to make sure that IP rights are there in place. And the job of engineers are to create the future.
I think that's actually very accurate. So I think that speaks to and Canada's promptly within that realm of lawyers. Non engineers were part of this western society that is no longer productive in the same way. And so that is also strangely directly affecting immigration even more than our internal choices.
[00:36:34] Speaker A: Well, you know, we might be able to handle it a little better. As I see Australia has done a deal with the US we could have easily done on some of our mining and resources here in in Canada. You know what, Mark? It sounds to me like you and I have other stuff to talk about. Maybe we can pick this up again. What do you say?
[00:36:52] Speaker B: Anytime.
[00:36:52] Speaker A: It would be a pleasure.
[00:36:53] Speaker B: I'm always welcome.
[00:36:55] Speaker A: Listen, on that topic, Mark, you Thank you very much.
[00:36:58] Speaker B: Welcome on your show. What I meant is it would be a pleasure. That's what I meant to say, not actually thank you.
[00:37:04] Speaker A: I knew the intent. But look, well, before we leave, please tell you're a lawyer, real estate agent. You are a billiard superstar. I made up that. But you do have a podcast that is unrelated. What's the name of your podcast? I'm sure people would love to check it out.
[00:37:20] Speaker B: Yeah, the podcast is called Brave New Something. It's just about global politics and economics and things that I'm interested in. So I just interviewed various people. We just had Bob Ray, the Canadian ambassador to the United nations on two days ago. So that's our most recent interview. And it's just born of love. It's just questions I want to ask.
[00:37:40] Speaker A: Well, you've got great guests and you're a great chat. I really appreciate your expertise on this. If people wanted to reach out and use your services, since you're not out there spending their money willy nilly on them. Where can people do that?
[00:37:52] Speaker B: You mean if people want to give me money for the trust account so that I can scon to Florida and they'll never hear from me again. You can use legalclothing. CA Professional Corporation.
[00:38:03] Speaker A: He's not gonna do that.
[00:38:06] Speaker B: I've been doing this for 25 years. The temptation is over. Legalclosing CA Professional Corporation. It'd be a pleasure to touch base with anyone.
[00:38:13] Speaker A: Mark Morris, you're a great guy. Thank you so much. And as more breaks on this or more breaks down in that industry overall. We're going to reach out to you.
[00:38:22] Speaker B: It will be more interesting to speak about this after the Denton's report is released and then substances can be put to rumor.
[00:38:29] Speaker A: Well, we'll talk to you then.
[00:38:31] Speaker B: Wonderful.
[00:38:32] Speaker A: Thank you so much and thank you for joining us. Don't forget to subscribe to everything on tpl. This is the Daily Canceled. People love to hate it. Please go ahead and do that yourself and subscribe to everything at TPL Media CA for now. I'm Mike. That's Mark Morris. We'll see you next time. Bye bye.
[00:38:50] Speaker B: Thanks guys.
