Mortgage Broker

CMB MAGAZINE cmba-achc.ca summer 2018 | 11 update letters CMBa MEMBErS' VIEWS Re: Submission to Canadian Securities Administrators Concerning Proposed New Legislation Affecting Syndicated Mortgages Lanyard, on behalf of itself and nine other major syndicators in British Columbia, organized a national legal firm to make a submission in relation to the above matter to the CSA and all provincial securities commissions. e issues at stake (which would include EMD qualifications for syndicators) are extraordinarily important to us. e CSA proposals, if unchallenged, might have disastrous consequences for our industry and will adversely affect the economy and real estate markets, in general, and the mortgage brokerage industry, in particular (by curtailing the availability of private mortgage funds). We, and the group we are involved with, as members of CMBA-BC, are extremely grateful for CMBA-BC's excellent submission to the CSA (which we understand was authored by your Samantha Gale) which strongly supports our position that the proposed changes are inappropriate due to being based on a misapprehension of what conventional syndicated lending involves. Your analysis and cogent arguments are impressive and we feel will cause the regulators to rethink their initiatives. We are fortunate to have an industry association such as CMBA-BC that can effectively advocate for its members and for informed and rational legislative change. Lanyard Financial Corporation Per: B Goldberg, B Chelin, S Fogell CSA hAS SOME 'SPLAInIng TO dO Re: Significant Flaws Contained In Proposed Syndicated Mortgage Regulations Well written, but I'd also like the CSA to address/explain how it will hold the EMDs liable for any losses/mistakes/fraud, how the EMDs will service the loans and exercise recourse when defaults occur, etc. CSA, frankly, doesn't know what it is talking about. Keep up the good work. Larry P. Carter President, MorFund Financial Inc. WhO'S An EMPLOyEE? Question: Can you please tell me are submortgage brokers in British Columbia considered employees, dependent contractors or independent contractors? Tonya Emel Mortgage Broker with DLC Producers West Answer: ank you for the telephone conversation and listening to me explain the value of membership. As promised, here is the answer to your question. Please remember, the answer is not intended as legal advice; it will however equip you to better obtain such advice from a lawyer. Submortgage brokers pose some challenging issues being categorized as employees or contractors; the categorization can differ depending on the purpose. For purposes of income tax, the Canada Revenue Agency (CRA) largely ignores the label of contractor or employee and categorizes the person depending on their work circumstances. e more independent is the person in performing the work, the more likely CRA will see the person as a contractor. e more their task is performed at times and place of their choosing, with their own tools and equipment, with the possibility of hiring additional staff at their own cost, and other such factors, the more likely CRA will see the person as a contractor. e more the person works at an office during set hours and using equipment provided by the person for whom work is being performed, the more likely CRA will see the worker as an employee. For purposes of mortgage broker regulation, the Mortgage Brokers Act (MBA) definition of the "submortgage broker" provides that submortgage brokers are either directors or partners of a mortgage broker or they are "employed" by a mortgage broker. For purposes of the BC Employment Standards Act (ESA), litigation has determined that submortgage brokers are employees and are accordingly entitled to the minimum standards set by the ESA. ere is nothing inconsistent about a person's being differently classified as a contractor or employee, depending on the purpose for which the classification is being made. Please send letters to the editor to info@cmba-achc.ca Effective Advocate

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