B.C. property manager accused of short-term rental fraud loses appeal of document production order

Matthew Kuras is seen in this photo from TRG The Residential Group Realty's website.

The B.C. property manager accused of tenanting multiple Vancouver properties “under false pretences” and subleasing them as short-term rentals without their owners’ consent has lost his appeal of an order directing him to produce documents for investigators.

Matthew Kuras has been in a legal battle with the B.C. Financial Services Authority for months, primarily over the regulator’s “order in urgent circumstances” directing him to share tax documents and other personal information, and his refusal to do so.

The latest decision in the matter came from the B.C. Financial Services Tribunal, which hears appeals of BCFSA discipline decisions and orders.

Panel Chair Jonathan Chaplan issued the decision April 17, but it was published on the tribunal’s website this week.

Chaplan rejected Kuras’ arguments that the BCFSA’s document production order didn’t meet the statutory criteria for issuing an urgent order, that the process leading up to the order was unfair, and that the scope of the order was unreasonable.

The panel chair dismissed Kuras’ appeal and confirmed the order.

The tribunal has previously made other rulings on the case, initially issuing a temporary stay of the BCFSA order, then denying Kuras’ application for a longer-term stay that would have kept the order from being enforced while his appeal proceeded.

It also denied Kuras’ appeal of $27,000 worth of administrative monetary penalties the BCFSA ordered him to pay for his non-compliance with the order, concluding that the tribunal didn’t have jurisdiction to hear that appeal.

CTV News has reached out to the BCFSA to ask whether Kuras has provided the requested documents since the April 17 tribunal decision. This story will be updated if a response is received.

• Read more: No suspension yet for B.C. property manager accused of short-term rental fraud

Short-term rental scams

The Kuras case is playing out in the wake of CTV News investigations that exposed fraudulent tenancies at multiple downtown Vancouver condo buildings last year, and ahead of an anticipated surge in demand for accommodations in the city during this summer’s FIFA World Cup.

While each case is different, the short-term rental fraud’s typical pattern is as follows.

A tenant signs a long-term lease on an apartment, often one that has been offered fully furnished. Rather than moving in, however, the “tenant” lists the unit on Airbnb or a similar short-term rental platform without the knowledge or consent of the property’s owner.

In some of the cases CTV News has reported on, the fake tenant has had several similar listings, suggesting the scam is being run on multiple units at once, in violation of provincial regulations that limit short-term rentals to a person’s primary residence and one secondary suite on the same lot.

• Read more: ‘A strange person opened the door’: How a Vancouver condo owner discovered his long-term tenant listed the unit on Airbnb
• Short-term rental scam in downtown Vancouver happening on another well-known booking platform
• One-on-one with B.C.’s housing minister on CTV News investigation into short-term rental scam
• Vancouver Airbnb host’s legal, paid registration number fraudulently used in multiple listings

The documents requested

The BCFSA is not responsible for enforcing provincial short-term rental rules. Rather, it is investigating Kuras for what it sees as contraventions of the provincial Real Estate Services Act and associated regulations, particularly those regarding conduct unbecoming of a licensee.

Kuras is licensed under the act as both a trading representative and a property manager.

The underlying allegations against him, which have not been proven, are described in an earlier BCFSA document. They include:

• Tenanting five properties in Vancouver “under false pretences” and renting them out as short-term rentals without their owners’ knowledge or authorization
• “Advertising real estate without the owner’s knowledge and authorization”
• “Falsifying contractual documents”
• “Exposing owners to fines” during tenancies Kuras managed
• And “making any false or misleading statement” in a document related to a licensing renewal application

In support of its investigation, the regulator asked Kuras for a variety of documents. While some of the requests were deemed overbroad by the BCFSA hearing officer who imposed the $27,000 administrative penalty for non-compliance, several requests remained outstanding at the time.

Those requests were for “a list of any additional properties” Kuras had leased and subleased since Jan. 1, 2021, contact details for each person he subleased to, sublease agreements for each party, copies of all payments received from the subleasees, and Kuras’ T1 tax forms and notices of assessment for tax years 2021 through 2024.

Kuras argued to investigators that most of the information the BCFSA requested from him was not relevant to the stated purpose of its investigation, and he has largely maintained this position throughout his appeals.

He also asserts that providing the documents would be a violation of his privacy outside the scope of the regulator’s authority.

“The order compels highly sensitive information, including multi-year banking records, CRA tax filings, and third-party financial and personal information,” he wrote in his submissions to the tribunal, as reproduced in the April 17 decision.

“These categories attract the highest privacy interests and require clear, compelling justification.”

Chaplan rejected this argument, agreeing with the BCFSA that the documents requested were “clearly connected to the allegations” against Kuras. The panel chair also quoted from his previous decision rejecting Kuras’ stay application to dismiss his privacy concerns.

“Regulatory bodies regularly demand the type of documentation that is the subject matter of the order, and there are corresponding privacy protections in the law to facilitate this type of disclosure to a regulator,” the quoted decision reads.

The panel chair similarly dismissed Kuras’ arguments about the legal basis for the BCFSA’s urgent order and the fairness of the process, finding the regulator’s conclusions “reasonable.”