Here is a round-up of the latest spruikers, advisers and 'experts' to receive special attention from the regulators in the past 30 days.
ASIC and consumer affairs bodies across the country have been kept busy over the last month, with numerous property-related professions put under the microscope. Here’s a summary of the most high-profile cases.
• Carl Raymond Olsen of Meekatharra, 37, was fined $24,000 for spending tenants’ security bonds, harassing a tenant and taking up to six weeks’ rent up front, according to Consumer Protection Western Australia.
Mr Olsen, who owned and leased out a property 20 kilometres from Perth, was found guilty of 13 contraventions of the Residential Tenancies Act committed during 2013 and 2014.
Property managers and real estate services
• Fiona Dickson, Director of SDH Realty in Springwood, pleaded guilty to 46 charges of wrongful conversion of trust monies, according to the Queensland Office of Fair Trading.
Ms Dickson was disqualified from holding a real estate agent licence for seven years. She was also ordered to pay $22,200 to 46 affected consumers and to perform 100 hours of community service, according to the regulator.
• Adelaide Realty, trading as LJ Hooker Flinders Park, was forced to pay $300 compensation for failing to provide appropriate notice of termination to a tenant. South Australia’s Consumer and Business Services said the agency used false grounds to order a tenant to vacate a property within 60 days instead of the standard 90 days.
• Real estate TV personality Frank Valentic was caught up in a tussle with Consumer Affairs Victoria, following claims that he misled buyers over an apartment development in Victoria. The claims, set to be heard by the Victorian Civil Administrative Tribunal in February, include:
- Arranging an inspection of Unit 2 while the unit was tenanted and without the tenant's knowledge that the inspection was taking place.
- Holding the inaugural Owner’s Corporation meeting for all four units, with only himself and an Advantage Property staff member present.
- Charging two purchasers a $13,750 ‘consulting fee’ for buyer's agent services despite not acting as a buyer's agent for those purchasers.
- Instructing purchasers to backdate a series of legally binding agreements.
- Compelling purchasers to use the conveyancer of Advantage Property's choice.
- Providing false information to a CAV Inspector in response to a notice.
• Western Australian promoters of a rent-to-buy property scheme will pay $70,000 compensation as settlement of Supreme Court action by Consumer Protection. Presto Property Solutions and its director Rowan Amanda Lines admitted to making false and misleading representations to three prospective buyers in 2010. The company and its director had placed advertisements in Quokka and on Gumtree making claims such as 'I buy houses fast' and 'No banks', with similar signs posted on light poles in Perth.
• Anthony Nicholls, 63, of Mitcham, was sentenced to four years and six months in jail by the Victorian County Court, including a non-parole period of three years, after pleading guilty in May to three charges of dishonestly using his position as a director of Zantholls International and Peton Properties to misappropriate money from investors.
According to ASIC, which led the investigation, these companies raised $2.68 million from about 20 investors to be used for property developments in Ballarat.
ASIC said that Mr Nicholls withdrew $757,000 from those funds for his own personal benefit between October 2004 and August 2006.
• Park Trent Property Services was found by the Supreme Court of NSW to have unlawfully carried on a financial services business for more than five years, by providing advice to clients to purchase investment properties through an SMSF. The court ordered a a permanent injunction against Park Trent restraining them from providing unlicensed financial product advice to clients regarding SMSFs.
Financial advice and mortgage broking
• ASIC has permanently banned a former Perth financial adviser Marion Joan Pearson following an investigation into her dealings with SMSF clients, which found she contravened financial services laws.
ASIC found that Ms Pearson engaged in conduct that was dishonest – including creating documents to disguise the fact that client money was paid into her company's (Colisa) bank account without the relevant client's knowledge or authority.
ASIC also found Ms Pearson engaged in conduct that was misleading or deceptive, in that she misled specified clients into believing the clients' funds were placed in particular investments, when she had not done so.
• ASIC has permanently banned Queensland-based home loan broker Jiangyong (Jenny) Mao from engaging in credit activities and providing financial services after an investigation found she had created and submitted false documents to support home loan applications for her clients.
• Grant Thorsby Ross, former sole director of both Motabank (SA) Pty Ltd and Multimedia Marketing Pty Ltd, has been charged with one count of carrying on a financial services business without a licence after allegedly promoting and operating a scheme facilitating the illegal early release of superannuation by recommending to clients that they dispose of their superannuation funds, which were then used to access loan funds.
• The Federal Court has awarded penalties totalling $1.25 million against a consumer leasing company for breaching consumer credit laws, including its responsible lending obligations.
The court handed down the penalty following its 28 April 2015 decision that Make It Mine Finance Pty Ltd (Make It Mine) failed to disclose important information to its customers, breached various responsible lending obligations and operated for a period while unlicensed.
• Tony Nguyen of Bankstown, NSW has been banned from engaging in credit activities on the basis that he has contravened and was likely to contravene the credit legislation, and was not a fit and proper person to engage in credit activities.
ASIC said Mr Nguyen’s conduct involved multiple breaches of the legislation and was considered serious, repeated and dishonest.
If you believe you’ve been the victim of improper advice or inappropriate professional conduct during your real estate dealings, get in contact with the consumer affairs body in your state or territory, or notify ASIC. If you want to learn more, have a read of our handy guide on how to avoid property spruikers and dodgy advice here.