Shailer Park real estate agency fined for trust account misappropriation
8 June 2018
A Shailer Park real estate agency was fined $5000 by the Beenleigh Magistrates Court today (8 June 2018) after charges were brought by the Office of Fair Trading (OFT) for misappropriating trust account monies.
Realty Brokers Pty Ltd (the agency), which traded as RE/MAX Territory, pleaded guilty to 11 charges of drawing monies from a trust account without authority as required under the Agents Financial Administration Act 2014 (the Act).
The court heard the OFT received a complaint in March 2018 alleging irregularities in the agency’s corporate trust account. The OFT undertook a compliance check at the agency’s business address in March 2018, which revealed the agency’s then Principal Licensee had withdrawn a total of $121,000 on eleven separate occasions without authorisation.
The then Principal Licensee of the agency cooperated with the OFT and admitted the funds transferred from the trust account were never intended for personal gain, but were used as a ‘short term loan’ to cover business expenses until money could be returned to the trust account.
The agency’s clients suffered no loss as a result of the trust account misappropriation.
In sentencing, the court stated the offending was of a very serious matter, but considered a number of mitigating circumstances including an early guilty plea, the cooperation with the OFT and no loss experienced by consumers.
Fair Trading Executive Director Brian Bauer said trust account monies must never be used as a short term business loan.
“Regardless of whether an agent intends to return trust money to the trust account, legislation requires that trust account money must never be disbursed from the trust account without proper authorisation,” Mr Bauer said.
Real estate professionals have a responsibility to their clients and their business to know and abide by their legal responsibilities.”
More information on managing a real estate business in Queensland, including a guide to managing trust accounts is available on the OFT website at www.qld.gov.au/fairtrading.