Agency delegating the opening and maintaining of a trust account to another agency: What does it involve?

An agency may delegate to only one other agency the opening and maintaining of a trust account. The agency delegating this responsibility is not required to open its own trust account. The agency entrusted with this responsibility, for its part, must use a single account to manage both its own deposits and those of the delegating agency.

An agency wishing to delegate the maintaining of a trust account must first make sure it has the consent of the agency which will be entrusted with this responsibility. Once this consent is received, the delegating agency must send the OACIQ a notice completed Trust account – Notice of delegation and delcaration of exemptions.

It is important to remember that the agency delegating its obligations and the brokers acting on its behalf remain bound, together with the agency entrusted with the responsibility, by the obligations related to the managing of the trust account.

It is recommended that right from the beginning the two agencies set up written procedures regarding deposits, remuneration advances or expenses received or deposited, the issuing of receipts, and the handling of dishonoured cheques. These procedures could also include a provision to the effect that all communications between the two agencies must be done in writing to avoid any ambiguity.

The agency entrusted with the responsibility will maintain only one general trust account in which both agencies’ deposits and advances will be deposited. We also recommend that the entrusted agency maintain a separate set of receipt books, deposit books and accounting registers, clearly identified to the delegating agency.

The entrusted agency should know that it may have reporting obligations toward the delegating agency; as for the latter, it could be required to pay management fees for this service.

For questions, please contact the OACIQ Inspection Department, at 450 462-9800 or 1 800 440-7170.