Today, the Real Estate Council of Alberta (RECA), Alberta’s real estate regulator, is providing an update on compensation for victims of Eric Drinkwater’s bridge loan Ponzi scheme.
RECA takes our responsibility to protect consumers very seriously. As part of this mandate, RECA administers the Real Estate Assurance Fund (the Fund), a consumer protection fund paid for by licensed real estate professionals. The Fund exists to help consumers recover financial losses resulting from a licensee’s fraud, breach of trust or failure to manage trust money properly. The Fund operates under legislation that defines what can be compensated and puts limits on payout maximum.
RECA applies these rules consistently to every application. Based on a detailed review of the applications received to date, we are announcing the following on the Drinkwater matter:
- Fifteen applications will be compensated for eligible financial losses—the money provided to Eric Drinkwater—up to the legislated cap of $35,000 per transaction. These transactions vary in value.
- Three applications have been denied because they do not meet the criteria.
- Some applications requested compensation for projected profits, lending fees, and other inducements offered by Eric Drinkwater. These are not eligible financial losses under the Fund and cannot be compensated.
The current total compensation for the applications received to date is $1,407,875.70, reflecting the scale and impact of this matter and representing the largest payout in the Fund’s history.
Eric Drinkwater’s actions caused significant harm to those involved and should never have occurred. We recognize the impact this matter has had on people, and RECA has permanently banned Eric Drinkwater from trading in real estate in Alberta. RECA is also further strengthening its focus on fraud education. Fraud risks continue to grow and become more sophisticated, such as in this case, reinforcing the need to provide even more tools for both consumers and industry to help recognize and prevent fraud.
RECA will continue to assess remaining applications and encourages anyone who believes they may be eligible to apply. For more information about the Real Estate Assurance Fund, including eligibility requirements and how to apply for compensation, please visit RECA’s Consumer Protection Fund page.
For more information on compensation applications related to the Eric Drinkwater matter, please read the RECA Q&A on Compensation Applications Related to Eric Drinkwater.
To read a timeline of events related to the Eric Drinkwater matter, including key actions and updates from RECA, please click here.