Two more agents caught for fraud

Staff Reporter 

Two more Queensland agents have been caught misusing trust money, with one case resulting in imprisonment.

Michael Wilkes was sentenced last month to five years of jail in the Brisbane District Court for misappropriating $412,769.40 from the trust accounts of his New Farm-based real estate agency, Excalibur Property Services Pty Ltd.

The Office of Fair Trading (OFT) and Queensland Police Service found Mr Wilkes had illegally removed the funds from two agency trust accounts for his personal use between November 2008 and November 2009.

After landlord clients complained, the Office of Fair Trading commenced an investigation into Mr Wilkes in 2009, including a forensic examination of the trust accounts.

Queensland Police Service continued the investigation and charged the agent with two counts of fraud.

Mr Wilkes pleaded guilty to the two charges and was sentenced to five years' imprisonment, with a suspension after 18 months.

The Queensland government’s Claim Fund had paid out over $412,000 to 70 affected clients, which Mr Wilkes and his agency was liable to repay, according to OFT executive director Brian Bauer.

“The Claim Fund is designed to reimburse clients who have been affected by dishonest or fraudulent real estate agents, and has provided a just result for the clients affected by Mr Wilkes’ fraud,” he said.

Real Estate Business were unable to reach Mr Wilkes for comment.

On Wednesday, the Brisbane Magistrates Court also charged a Gold Coast real estate company $50,000 for 231 counts of dishonestly converting trust money to its own use.

Staymint Pty Ltd, former operator of Broadbeach building complex Carmel by the Sea, pleaded guilty to wrongfully converting $141,466 in trust money between 1 July 2011 and 1 August 2012.

According to the OFT, Staymint staff had booked tenants into rooms in Carmel by the Sea’s letting pool then, after the guest had checked out, changed the records to indicate the guest had stayed in a leaseback unit.

This involved transferring the amount from this stay to the company, instead of to the owner of the unit where the tenant stayed.

The OFT investigated after a unit owner complained he had not received rent from tenants who had signed the guest book in his unit.

The court heard Staymint were in the process of repaying the 34 affected unit owners, with $75,000 paid to date. No conviction was recorded against the company.

Staymint Pty Ltd director Murray Boyte told Real Estate Business the prosecution arose from the unauthorised and unlawful conduct of an employee whose actions were in flagrant breach of the company's policies and procedures. 

"The Office of Fair Trading investigation confirmed that the directors of the company were unaware of the employee's actions, which went undetected by the regular and mandatory independent audits of the company's trust account records," he said. "As a result, no directors were charged in any way. 

"The directors were shocked to learn of the employee's conduct. As soon as they were made aware of the allegations, they ordered a thorough internal investigation into the matter to determine the extent of the employee's unlawful activities.

"The company cooperated fully with the Office of Fair Trading and worked diligently in conjuction with that Office to ensure that owners were compensated for the misallocation of funds for the relevant period."

Mr Boyte added that their cooperation with the OFT, their unblemished record and other factors were noted by the court when acknowledging that it was not appropriate that a conviction be recorded against the company.  

Staff Reporter 

Two more Queensland agents have been caught misusing trust money, with one case resulting in imprisonment.

Michael Wilkes was sentenced last month to five years of jail in the Brisbane District Court for misappropriating $412,769.40 from the trust accounts of his New Farm-based real estate agency, Excalibur Property Services Pty Ltd.

The Office of Fair Trading (OFT) and Queensland Police Service found Mr Wilkes had illegally removed the funds from two agency trust accounts for his personal use between November 2008 and November 2009.

After landlord clients complained, the Office of Fair Trading commenced an investigation into Mr Wilkes in 2009, including a forensic examination of the trust accounts.

Queensland Police Service continued the investigation and charged the agent with two counts of fraud.

Mr Wilkes pleaded guilty to the two charges and was sentenced to five years' imprisonment, with a suspension after 18 months.

The Queensland government’s Claim Fund had paid out over $412,000 to 70 affected clients, which Mr Wilkes and his agency was liable to repay, according to OFT executive director Brian Bauer.

“The Claim Fund is designed to reimburse clients who have been affected by dishonest or fraudulent real estate agents, and has provided a just result for the clients affected by Mr Wilkes’ fraud,” he said.

Real Estate Business were unable to reach Mr Wilkes for comment.

On Wednesday, the Brisbane Magistrates Court also charged a Gold Coast real estate company $50,000 for 231 counts of dishonestly converting trust money to its own use.

Staymint Pty Ltd, former operator of Broadbeach building complex Carmel by the Sea, pleaded guilty to wrongfully converting $141,466 in trust money between 1 July 2011 and 1 August 2012.

According to the OFT, Staymint staff had booked tenants into rooms in Carmel by the Sea’s letting pool then, after the guest had checked out, changed the records to indicate the guest had stayed in a leaseback unit.

This involved transferring the amount from this stay to the company, instead of to the owner of the unit where the tenant stayed.

The OFT investigated after a unit owner complained he had not received rent from tenants who had signed the guest book in his unit.

The court heard Staymint were in the process of repaying the 34 affected unit owners, with $75,000 paid to date. No conviction was recorded against the company.

Staymint Pty Ltd director Murray Boyte told Real Estate Business the prosecution arose from the unauthorised and unlawful conduct of an employee whose actions were in flagrant breach of the company's policies and procedures. 

"The Office of Fair Trading investigation confirmed that the directors of the company were unaware of the employee's actions, which went undetected by the regular and mandatory independent audits of the company's trust account records," he said. "As a result, no directors were charged in any way. 

"The directors were shocked to learn of the employee's conduct. As soon as they were made aware of the allegations, they ordered a thorough internal investigation into the matter to determine the extent of the employee's unlawful activities.

"The company cooperated fully with the Office of Fair Trading and worked diligently in conjuction with that Office to ensure that owners were compensated for the misallocation of funds for the relevant period."

Mr Boyte added that their cooperation with the OFT, their unblemished record and other factors were noted by the court when acknowledging that it was not appropriate that a conviction be recorded against the company.  

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