$6m profit for ‘deceitful’ agent’s illegal scheme
An ex-real estate agent, whose land deals reaped a $6 million profit for his family, has been slammed for “the worst possible betrayal” of buyers which resulted in the loss of his agent’s licence.
Former York, Western Australia real estate agent, Colin Maxwell King – who operated The King and I Pty Ltd trading as Colin King Real Estate and his son Paul Anthony King who worked as a real estate sales representative at the agency – were found to have engaged in misleading conduct after a “deceitful” land deal resulted in a $6 million profit for family members.
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The land deals occurred between 2008 and 2010, and involved the separate sales of six rural lots, with the Kings acting as selling agents for three of them and introducing the ultimate buyers to each sale, Consumer Protection said.
All six lots were first sold to an intermediary company controlled by another of Colin King’s sons, Michael King, who was not a licensed real estate agent or sales representative.
The land lots were then immediately on-sold to Malaysia-based investors at substantially higher prices resulting in a $6 million profit that directly benefited Michael King, Consumer Protection said. The original owners and the Malaysia-based investors were not aware on the on-sale arrangements.
The SAT upheld Consumer Protection’s allegations that the Kings had:
- Failed to act in the best interests of the seller
- Failed to act fairly and honestly in facilitating the on-sale scheme
- Misled or deceived the original sellers
- Failed to disclose material facts to the sellers
- Acted in the circumstance of a conflict of interest
With regards to the three lots not sold through Colin King Real Estate, Colin and Paul King were still found to have acted unfairly and dishonestly by facilitating the on-sale scheme.
Colin King had also appealed for the SAT to review the decision by the commissioner for Consumer Protection not to renew his license in August 2014, but the SAT upheld the decision. It agreed that due to Colin King’s misconduct in the on-sale scheme, he was not of good character, and not a fit and proper person to hold a licence.
The SAT, however, was unable to impose a penalty in this case, as Colin King and The King and I Pty Ltd were no longer licensees, and the tribunal had no jurisdiction although it found the allegations proven.
The SAT will impose a penalty on Paul King, who no longer holds a sales representative’s certificate, at a later date.
Acting commissioner for Consumer Protection David Hillyard said the on-sale scheme was one of the worst cases of deception perpetrated by a real estate agency in WA.
“Colin King and his two sons Paul and Michael acted deceitfully to manipulate a circumstance where they made massive profits at the expense of landowners who had put their faith in the agency to act in their best interests,” Mr Hillyard said.
“That trust was betrayed in the worst possible way by denying the owners the true profit from the sale of the land. The loss of Colin King’s licence was more than justified as his actions, and those of his sons, were reprehensible by being involved in this illegal on-sale scheme.
“This was deception on a grand scale, and reinforces the importance of having a licensing system and codes of conduct for the real estate industry to protect the interests of buyers and sellers of property in WA.”
