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A WA real estate agency and sales representative have been fined $12,000 each for engaging in dishonest conduct during property sale transactions.
Sunrun Nominees Pty Ltd, trading as House Real Estate WA, and Frank Andrew Torre are subject to orders after contravening the Real Estate and Business Agents Act 1978 and the Code of Conduct for Agents and Sales Representatives.
In addition to the fines, Sunrun was reprimanded and must pay $3,000 in costs, while Mr Torre, who is a director and shareholder, will have his sales representative licence suspended for three months from 3 March 2017. He has been ordered to pay costs of $4,884.
The penalties relate to the early receipt of commissions in 2012 and 2013, the paying of a deposit into an inappropriate account, the failure to properly manage trust accounts and the misappropriation of funds.
The early receipt of commissions related to nine properties and amounted to more $310,000. The amounts were withdrawn by Sunrun on Mr Torre’s instructions. Mr Torre also dishonestly obtained consent from vendors even though consent did not make the early receipt of commission legal.
A deposit was paid by a home buyer into a separate interest-bearing account without the permission of the purchaser.
Sunrun was also found to not have recorded all sales transactions in its trust accounts, nor did it balance the books during the 2013 audit year or notify the Commissioner for Consumer Protection when an account was overdrawn in 2014.
In January 2013, $6,000 was withdrawn from the company’s sales trust account and transferred to Mr Torre’s personal account when he was only entitled to take $457.59. A further $1,000 was transferred to Mr Torre’s personal bank account from a sale where he wasn’t entitled to any funds.
A State Administrative Tribunal hearing was held on 9 December 2016 and final orders were delivered on 17 February 2017.
Acting Commissioner for Consumer Protection David Hillyard warned that a zero-tolerance approach will be taken with agents who engage in dishonest and inappropriate trust account practices.
“Our case acts as a clear warning to all sales representatives who are directors of corporate real estate agencies that you cannot escape or avoid liability for your actions simply because you are not licensed as a real estate agent,” Mr Hillyard said.
“In this instance, Mr Torre sought to argue that as a sales representative, he should be held to a lower standard than that of a fully licensed agent. Our investigation revealed that Mr Torre was the true guiding mind of Sunrun and through our actions in the SAT he’s been held accountable for those transgressions.”
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