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Agency fined for trust account and PM breaches

By Staff Reporter
08 February 2019 | 1 minute read
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A Port Hedland real estate agency and its director have been fined a total of $4,000 by the State Administrative Tribunal (SAT) for misconduct relating to its property management services.

Real Estate Property Shop Network Pty Ltd was reprimanded and fined $3,000 for misconduct in relation to property management services, including making incorrect withdrawals from its trust account. The agency was found to have failed to exercise due skill, care and diligence in breach of the Real Estate and Business Agents Act and Codes of Conduct.

The agency’s director-licensee, James Samuel Henneberry, was reprimanded and fined $1,000 for not properly supervising the property management services provided by the agency.

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Between June and August 2016, the Real Estate Property Shop Network mistakenly made three unauthorised withdrawals totalling $664.70 from its trust account for property management fees where the property owners were entitled to receive that money.

The agency also mistakenly withdrew small amounts from its trust account between April and June 2017 after the agency had ceased to act for the property owners.

The company eventually reimbursed the property owners a higher amount than they had lost.

However, the SAT also found that the company engaged in other conduct that breached the industry codes by failing to exercise due skill, care and diligence, including failing to promptly notify the property owners that a tenant had abandoned the property and failing to obtain orders against the tenant for unpaid rent and release of the security bond.

The SAT also found that Mr Henneberry failed to take reasonable steps to properly supervise the agency’s employees to ensure that breaches of the Act and Codes did not occur. His conduct included failing to give sufficient attention to the accounts of the business and failing to employ people with relevant training, qualifications and experience.

Commissioner for Consumer Protection David Hillyard said that real estate agents must strictly adhere to the laws surrounding the operation of their trust accounts.

“These trust accounts can often hold large sums of money on behalf of the agent’s clients, so the laws are designed to protect those funds and prevent any possible misappropriation,” Mr Hillyard said.

“All withdrawals from the trust account must be correct in all aspects and strictly be for the express purpose of the real estate transaction or be authorised by the person for whom the money is being held. Any misconduct concerning trust monies can undermine public confidence in the real estate industry.

“It is also imperative that agents comply with laws designed to protect the interests of owners and tenants when managing properties.”

Agency fined for trust account and PM breaches
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