As some said it isn't up to you to determine if it is illegal, report suspicions and the proper people straighten out the details.

There is a chance, especially being past teachers, that they are running an after school type program and have older school age children. The age cut off for ratios is changing but maybe the kids are all older. Or maybe they are all older but are being run like a private school so they have 12kids but none are 2,3,4 years old etc. Without knowing the details you really can't tell if they are legit. But, knowing that there is a home daycare with 12+ kids puts you in the position to report so it can be followed up with.

Also, I am not sure on the details and it may vary by province but do home daycare not have to be in YOUR home? Like you need to live there, can't just rent a house to be run as a business without living in it? That would put them in a position of needing a daycare centre permit and all that jazz.