It’s supposed to be a happy day — closing the deal on one of the largest transactions in your life.
But behind the lawn signs and open house doors in Calgary’s real estate sector, a nefarious scandal has been unravelling for years.
Calgary real estate agent Derek Davidson says he is one of dozens of victims.
“I was being constantly assured, misled, down the path until he got to the point he could no longer hide it.”
Over the past several years, Davidson says he’s been waiting for his money back after lending former real estate agent Eric Drinkwater $80,000.
“(Drinkwater) continued to delay and lie to people, telling him they were going to get the money… until (the scheme fell apart).”
Davidson is one of several people who spoke to Global News, saying they were victimized in a similar way — by a complex bridge financing scheme orchestrated by Drinkwater.
He says he knew of Drinkwater through the industry — working with him in the past on deals or running in to him at real estate events.
One day, Davidson says Drinkwater approached him with a proposition. Drinkwater said his clients needed a bridge financing loan to secure a down payment on their next property before officially selling their current one.
Davidson says these loans are common — but typically they’re done through lending companies or banks.
What made this one unique, according to Davidson, Drinkwater told him — his clients were unable to secure the loan in the normal fashion, so the loan would come with a handsome return on investment — delivered to him in short order.
“I wouldn’t have given it to him on a handshake,” Davidson says.
“I felt I was confident and secure in his track record and the paperwork that had been signed.”
Davidson said he hasn’t seen a dime of it in the two years since.
“He started giving me screenshots of the money in his bank account — it’s there,” Davidson explains, saying Drinkwater would give him excuses such as technical troubles at the bank, or family matters delaying the repayment.
By July of 2024, Davidson had run out of patience and contacted the Calgary Police Service.
“I mean, I went from thinking I was going to get my money back, I’ve just got to be patient, to (thinking) I’m never going to get my money back, to realizing I was defrauded and duped, to realizing I was one of many.”
By the time law enforcement had been made aware of the allegations, two other investigations had already begun.
The Real Estate Council of Alberta (RECA), which regulates real estate agents in the province, had suspended Drinkwater’s real estate licence in June of 2024 — although it had already lapsed two months prior.
That same spring, Calgary lawyer Blair Ector had also been diligently working on the case after being approached by a handful of clients.
The stories of his clients followed a similar path to Davidson’s account of his experience with Drinkwater — except his clients weren’t involved in the real estate industry.
Some were personal friends of Drinkwater. Others met him through team sports.
“Initially when (Drinkwater) would start with much lower amounts with high rates of return, and he would usually pay that first, make the first payment back towards the smaller loans,” Ector says.
“And then he would gradually and progressively build bigger and bigger loans.”
Ector soon filed a statement of claim on behalf of four clients — which court documents show are collectively owed more than $2.2 million by Drinkwater.
“(The loans) would be backed by promissory notes, pledging his house as security for various items,” Ector says.
A civil court decision by Justice Barbara Romaine says those facts were not disputed by Drinkwater.
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“Mr. Drinkwater would execute promissory notes, which included the principal amount of the loan, the return, and the due date, and which were occasionally secured against assets that were said by Mr. Drinkwater to be his property. These assets included his personal vehicle and a home,” Romaine’s decision reads.
“The lengths that Drinkwater went to… it was a fairly sophisticated fraud,” Ector says.
During the investigation by Ector and the Real Estate Council of Alberta, the scale of the fraudulent scheme became more clear. At least 71 possible victims have been identified.
In May of this year, Drinkwater was charged by Calgary police with one count of fraud over $5,000.
“So far, 16 victims have come forward to police with a combined loss of more than $1.9 million,” the Calgary Police Service wrote when announcing the charge.
With his licence currently suspended, the Real Estate Council of Alberta is engaged in ongoing disciplinary hearings with Drinkwater.
Investigation deeper than Drinkwater
Court documents show the investigation found concerns about Drinkwater reached the desk of two other prominent men in the Calgary real estate industry — the owner of Re/Max Central, Pat Hare, and managing broker, David Lem.
In court proceedings, Drinkwater claimed Hare — who is also his uncle — was aware of his scheme for more than five years before the civil investigation began.
In court questioning, Lem admitted to being aware of Drinkwater not repaying personal loans as early as December 2021.
Over the next several years, court documents show communication between Hare, Lem and Drinkwater, including a March 2023 email from Lem, to Drinkwater and Hare:
“We’ll make every effort to diffuse and situation that comes to our attention that you make us aware of and we’ll leave it to an internal matter at this time.”
According to a decision in the civil court action, three days before that email was sent, a document was added to Mr. Hare’s assistant’s computer that detailed Drinkwater’s fraudulent scheme in its entirety.
According to the decision, an email exchange between Hare and Drinkwater happened in early August of 2023, in which Hare was advising Drinkwater to apply for bankruptcy.
According to the court decision, Drinkwater stated to Hare that he would “call RECA,” to which Hare replied:
“You do not have to call RECA unless you go bankrupt. What are you going to tell them? That you stole other people’s money or you put them on a Ponzi scheme?”
Despite their knowledge of complaints, neither Hare nor Lem reported Drinkwater’s conduct to the Real Estate Council of Alberta, according to Justice Romaine’s decision.
Ector recalls seeing that exchange for the first time.
“That was quite shocking, to see to see direct reference to calling it a Ponzi scheme — you don’t expect that when you’re putting together the financial transactions, all the late nights working on this.”
The journey towards justice
Although Drinkwater hasn’t held a real estate licence in Alberta since April 2024, many victims tell Global News the wheels of justice are spinning far too slowly.
Drinkwater’s hearing with the Real Estate Council of Alberta is still ongoing. No settlement has been reached in his civil lawsuit with Ector’s four clients.
Drinkwater will appear in court on Aug. 11 on his criminal charge.
Davidson says he’s one of many who are still waiting.
“It’s taken a year to get to this point. He admitted to RECA right away of his conduct — and there were other (parties privy to the scheme) that have not yet received any sanction.”
Several new developments have inched victims closer to the justice they seek.
In May, Re/Max Canada suddenly ended its franchise agreement with Re/Max Central.
“The REMAX network shares and honours a commitment to professionalism, integrity and honesty,” the company said at the time.
“The goal is not simply to meet minimum requirements of applicable laws, regulations and professional standards, but to aspire to even higher levels of professionalism.”
Since then, the brokerage has continued to operate under the name 4th St. Holdings.
The Real Estate Council of Alberta tells Global News the brokerage is in the process of winding down operations.
“We continue to monitor the activities of 4th St, Holdings to ensure ongoing compliance with all our regulatory requirements,” a RECA spokesperson says.
RECA has also issued Notices of Hearing to both Hare and Lem, alleging awareness of Drinkwater’s conduct related to fraudulent activity as early as 2021.
Both Hare and Lem will appear in front of the council in mid-August. Hare has denied the allegations in his Statement of Defence.
Global News has made multiple attempts to contact Hare, Lem and Drinkwater on these various personal matters. All efforts have gone unanswered.
The battle for compensation
Despite progress in recent weeks towards justice and sanction at both RECA and through the court system, victims and those claiming to be victims still await word on when — or if — they’ll ever get their money back.
“I am diligently and consistently trying to pursue justice — not just for me but for the other people that need it more than I do,” Davidson says.
“So I am steady in my resolve, I’m hopeful, but I also realize I have to let the process play out.”
For more than 40 years, RECA has been in charge of a Consumer Protection Fund, (also known as the Assurance Fund) paid into by realtors across the province.
Individuals are allowed to apply for a maximum compensation claim of $35,000 if they believe they’ve been defrauded by a licensed real estate or mortgage professional.
“We understand how difficult and frustrating it can be for people who have suffered financial loss to navigate this process,” a RECA spokesperson tells Global News “No one wants to be in the position that Drinkwater has put them in.”
“This is a complex case, and we encourage victims to contact RECA directly with any questions on the Assurance Fund. We will walk them through the process we are required to follow to assess each claim and let them know what information we need.”
RECA says it will take time for each application to be reviewed on its own merits to determine eligibility.
But several victims or claimants who spoke to Global News on condition of anonymity say their efforts to work with the regulator have been unsuccessful for a variety of reasons.
In this case, the council says many of the victims gave Drinkwater what amounted to personal loans, not tied to a real estate transaction.
Ector has been fighting on behalf of his clients for access to the Fund for months now.
“We have met, in our view, the requirements to make the applications to (RECA),” Ector says. “The Assurance Fund exists to protect the public from fraud. In our views, this meets it… a lot of it is going to be in (RECA’s) hands.”
RECA says the fund has paid out roughly $3.6 million in compensation since 1985, including $156,000 in the previous two fiscal years combined.
Issues with the regulator
Global News spoke to several industry sources for this story.
Many of them share a common belief — that the regulator may have had the chance to stop Drinkwater’s scheme earlier than it did.
“This was brought to RECA long before 2024,” explains Brad Mitchell, CEO of the Alberta Real Estate Association.
“What they did with it is really what’s in question, but it was very clear to a lot of people in the industry at the time that something was not right.”
Court documents from the civil case show Lem claiming he notified RECA in April of 2023 of concerns about an agent not repaying loans at Re/Max Central, but did not provide names or details. Lem also admitted he failed to mention that there were many complaints and that he had concerns about misconduct, fraud, deception and unlawful activities.
Global News asked RECA if it received complaints outside of their mandate prior to beginning their investigations of Drinkwater, Lem or Hare.
RECA indicated that it did receive two complaints about Drinkwater in February 2024 but the complaints appeared to be private lending matters that fell outside of its jurisdiction.
RECA also told Global News that the issues concerning Drinkwater within their jurisdiction were brought to its attention in April 2024 and it acted immediately to suspend Drinkwater’s licence.
Re/Max House of Real Estate agent Jason Bamlett formerly served on one of RECA’s four Industry Councils, but earlier in 2025, he resigned, expressing concern with the handling of the Drinkwater scandal.
“Why isn’t the Real Estate Act protecting us?” Bamlett asks. “(The act) has the jurisdiction. Although I don’t believe it could have been prevented, there are certainly mechanisms within the Act that could have mitigated damages and protected the public.”
“It’s just a bunch of errors upon errors,” Mitchell says.
“Unfortunately when the light is shone on it, I think we’re going to see there needs to be some real changes.”
This month, Service Alberta is launching a review of RECA — something done every five years.
“Given that the previous review was limited in scope, a broader and more in-depth analysis is now needed — especially since no comprehensive review of RECA has been conducted since its creation in the 1990s,” says Brandon Aboultaif, press secretary to Minister of Service Alberta, Dale Nally.
“We welcome this opportunity to assess how the model is working and where it can be strengthened,” a RECA spokesperson says, adding a recent survey of licensees showed 95 per cent of respondents believe the council is meeting its mandate.
“We’re always looking for ways to do better for both consumers and the professionals we regulate.”
Until then, Davidson and other victims or claimants continue to wait.
“You lose sleep over it, you think of the people it hurt more than you, the impact it’s had on my family.”
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