(07) 3891 1150

08 Oct 2017

OFT : Agents Must be trustworthy

A Brisbane real estate agent was sentenced in July to 12 months’ imprisonment, suspended for 18 months, for wrongful conversion of trust money.

Satvinder Sign Dhillon, sole director and principal agent of Lionheart Realty, was also disqualified from holding a real estate licence for five years.

The court heard, tenants paid rent and bonds to Lionheart Realty in mid-2016, but rather than paying property owners rent money owning to them and passing the bond money on to the Residential Tenancies Authorities (RTA), Mr Dhillon transferred the trust money, a total of $13,142.65, to his personal account.

The Office Of Fair Trading (OFT) investigation also revealed Mr Dhillon’s real estate license expired in May 2016, but he continued to illegally work as a real estate agent, operating Lionheart Realty.

In Sentencing, the magistrate stressed the seriousness of the offences and the betrayal of trsut that such breaches cause.

The case serves to highlight the seriousness with which the OFT treats trust account misappropriation. Eight of the top ten types of breaches detected by the OFT in the real estate industry relate to trust accounting.

Bond money does not belong to a real estate agent and must be transferred to the RTA within 10 days of having received it.

Real Estate Agents who intend to receive money on behalf of others, including the RTA, are required by the Agents Financial Administration Act 2014 to have a trust account and to pay any money received directly in the trust account before the end of the first business day following receipt.

To assist agents to comply with their obligations under the Act, the OFT has created a comprehensive trust accounts guide for property agents and their auditors, providing advice on:

  • Opening and closing trust accounts
  • Operating trust accounts
  • Receiving and paying out trust monies
  • Record keeping
  • The auditor’s role.

 

Share Socially