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Letting agent’s actions cost $700,000

A resident letting agent and company have been fined $418,716 after the Office of Fair Trading brought disciplinary proceedings for keeping expenses from unit owners that they were not authorised to retain and for failing to disclose conflicts of interest to unit owners.

Donald McGrath and Halmarn P/L were also ordered to pay restitution of $209,358 to complainants, $135,056 in court costs and have been disqualified from obtaining or renewing their resident letting agent licences by the Queensland Civil and Administrative Tribunal.

Halmarn P/L was found to have breached the Property Agents and Motor Dealers Act 2000 on 1135 counts by overcharging for credit or charge card transactions, agent´s commissions, or charging fees and commissions without authority. The company was also found to have breached the act on a further 11 occasions for failing to disclose to unit owners entering the letting pool, it had interest in other units within the pool.

Donald McGrath was the sole director of Halmarn and failed in his obligations under the act, which requires the executive officers of a corporation to ensure that the corporation complies with the act.

QCAT heard that, under the terms agreed to in the company´s appointment as a residential letting agent, Halmarn was only entitled to charge the unit owners the actual credit card or charge card commission as set by the bank. Instead it charged a set rate that was significantly higher than the bank fee.

The act permits resident letting agents to charge expenses and fees for services only if both parties agree in writing to those charges.

In 2009, the Office of Fair Trading received complaints about Halmarn and Mr McGrath from unit owners at Magnetic International Resort Hotel, on Magnetic Island. The owners alleged Halmarn and Mr McGrath were breaching the act by unfairly profiting at the owner´s expense.

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