- Consumer Affairs Victoria handed out 117 infringement notices last year
- Those who fail to have their trust accounts audited can face up to $20K in fines
- Those fraudulently using trust account funds can face over $82K in fines and 10 years' in prison
The Victorian Government has reminded real estate agents to make sure they are handling client money appropriately after Consumer Affairs Victoria was required to take action against misappropriation of trust account funds.
Last year, Consumer Affairs Victoria handed out 117 infringement notices, totalling over $120,000, with many official warnings to agents who did not lodge trust account audit reports.
Melissa Horne, the Minister for Consumer Affairs, Gaming and Liquor Regulation, said it was important to follow estate agent trust account laws, and acknowledged while most agents do the right thing, those who don’t could face harsh penalties.
“Trust account audit obligations are critical to protecting money that belongs to other people, and estate agents who don’t comply will be held accountable,” she said.
“Estate agents need to understand their trust account requirements, and anyone who breaks the rules will face the consequences of their negligence.”
Melissa Horne, Minister for Consumer Affairs
Under current rules, agents who don’t have their trust accounts audited, or who fail to lodge a copy of the report, can face penalties of up to $20,000.
In more severe cases, where those have used trust money fraudulently, the maximum penalties include an $82,510 fine or up to ten years’ imprisonment.
A statement from the Victorian Government clarifies that an estate agent must deposit client money they have received in advance into a trust account – including sales deposits, rent or fees for advertising and maintenance.
A notable inclusion is rent relief grants arising from a rent reduction agreement undertaken during coronavirus emergency rental measures.
As a result of coronavirus restrictions last year, the government offered flexibility to estate agents and industry partners who were unable to access offices and access to auditors. A grace period ended in December 2020 for agents to lodge their trust account audit reports for the 2019-2020 fiscal year.