Real estate agency fined for unauthorised withdrawal

Stock image.
Stock image.

A FREMANTLE real estate agency has been fined $3000 after they were found guilty of an unauthorised withdrawal from a trust account.

The State Administrative Tribunal said Port City Pty Ltd, trading under the name Port City Real Estate, withdrew $4735 from a trust account in July 2017 as a “break contract fee” despite it not being permitted under their agreement with the client.

On top of the $3000 fine the agency was ordered to pay costs of $1000.

Consumer Protection said the agency believed they had authority to withdraw the funds and that they had made changes to procedures to ensure the breach was not repeated.

Consumer Protection commissioner David Hillyard said real estate agents should not assume funds held in trust on behalf of clients could be withdrawn without authority.

“Technically the money is owned by the client until it can be dispersed according to the property management agreement, as specified by the Act or as agreed by the parties,” he said.

“Agencies must be acutely aware of the rules surrounding the handling of trust funds and ensure that they are followed, without exception.

“Even if money is withdrawn by a mistaken belief, the violation can result in disciplinary proceedings, as has happened in this case, which adversely affects the agency’s reputation in the community.”

Visit www.consumerprotection.wa.gov.au for more information.