Real estate investing platform Addy admits to unregistered trading

Addy, a Vancouver-based company that offers fractional investments in real estate and bills itself as Canada’s largest real-estate investment platform, has paid $100,000 to the BC Securities Commission (BCSC) for trading securities without being registered.

The company operates an online platform where individuals can invest in real estate properties and developments for amounts as low as $1, by purchasing shares or limited partnership units. On its website, Addy says its platform provides everyone with the chance to get into the real estate market, and that because users own a piece of property alongside thousands of other community members, they share in the risks and rewards together. 

The settlement document notes that between 2018 and 2025, Addy traded in approximately $26 million of securities from various issuers, with an average amount of $700 per investor. 

From 2018 to 2022, the company charged its investors membership fees to access specific properties and additional features on its platform (though membership fees were not required to invest using Addy.) It also charged software licensing fees up to $25,000 to issuers and exempt market dealers to use its product. 

The BCSC determined that Addy was required to register as a securities trader because it was soliciting investments through its online platform, emails, and social media; was acting as a middleman for trades of the issuers’ securities; and was receiving fees for use of its online platform. The settlement also notes that Addy was “carrying on the activities with repetition, regularity, or continuity as part of its overall business activity.”

The company voluntarily provided information to BCSC investigators and acknowledged its misconduct before it was issued with a hearing notice, which the government agency notes resulted in time and cost savings. 

In response to the BCSC’s assertion, Addy attempted to claim the crowdfunding exemption, where a company completes an offering document which is made available online through a funding portal, and has 90 days to raise enough money to hit its target. The BCSC ruled that the exemption was not applicable in this case, because some of the issuers had principals in common with Addy. 

The company also pointed out that it used exempt market dealers registered with the regulators to facilitate its trades. BCSC determined that because Addy continued to solicit prospective purchasers, which contravenes the national rules around those dealers, the exemption wouldn’t apply.

The settlement document notes that Addy has no prior history of securities regulatory misconduct, and that the company has now applied to register with regulators as a dealer so it can continue to carry out its business with the same features.

Addy has addressed the settlement in a post on its website, where it notes that its model is novel, and that it has been navigating the regulatory landscape with a view to ensuring compliance. It says it has been working closely with the regulators and exempt market dealers as part of those efforts, and that it is now “at a turning point in [its] journey.” 

The company says that its registration presents more investment opportunities on its platform, and that the move will unlock new ways to make the experience better for its users.

“Now that the mutually agreed-upon settlement is complete, we’re focused on the future — becoming a registered exempt market dealer,” Stephen Jagger, co-founder of Addy, tells the Vancouver Tech Journal. “It's a major milestone that will allow us to continue to build innovative technology that makes real estate investing accessible to all Canadians, while operating with even greater oversight and transparency. New and existing members can expect more investment opportunities, new features that help facilitate these investments, and — in short order — a more streamlined experience. We're very excited about the future of Addy and look forward to sharing more soon.”

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