Cairns letting agent jailed after misusing trust account and lying to owners

$23$ October $2020$

A Cairns resident letting agent has been convicted and sentenced to two years in prison in the Cairns Magistrates Court after being prosecuted by the Office of Fair Trading $($OFT$).$

An extensive OFT investigation led to Stuart James Wright, principal licensee of Three Sista$$s Pty Ltd$,$ pleading guilty to $437$ offences connected with the management of the Plaza Palms Resort in Manunda. Mr Wright is required to serve six months in prison and will be eligible for parole in late March $2021.$ He has been banned for life from working in the real estate industry. Three Sista$$s Pty Ltd ran the Plaza Palms Resort as a crisis and transitional accommodation centre for vulnerable consumers. The court heard Mr Wright made $406$ unauthorised transfers from the trust account between $1$ January $2017$ and $23$ March $2018$ totalling $$292,393.$ Although the money was supposed to be held in trust, it was used for a number of other purposes including Mr Wright$$s personal electricity bills, rental of kitchen equipment and repayments of a business loan. The court also heard Mr Wright told unit owners in December $2017$ that the front door locks for each unit needed to be replaced and charged them $$143$ per unit. No payment was made to a locksmith and the locks were not changed. The OFT instructed Mr Wright to refund each of the unit owners, and he advised that he did so in January $2018.$ However, checks by OFT investigators established Mr Wright had amended owners$$ ledgers to make it appear he had complied but he had not repaid the money to the trust account. The court was advised that in December $2017$ Three Sista$$s Pty Ltd entered into an enforceable undertaking with the OFT regarding the unauthorised use of trust money to pay their trust account auditor. The undertaking required the company to repay the audit fees to the trust account and provide proof of that repayment to the OFT. The OFT investigation revealed that no repayment had been made to the trust account as required. It also found Mr Wright had emailed a false bank statement to the OFT in February $2018$ to portray that repayment had occurred. The OFT investigation also revealed Mr Wright made $25$ applications to a business for tenancy bond loans on behalf of tenants, the majority of whom had already lodged bonds for their tenancy. For $15$ of those applications, Mr Wright applied for inflated bond amounts. Bond amounts totalling $$26,150\mathrm{.}00$ were received into the trust account of the business and Mr Wright dishonestly converted those funds to use himself and for his business, and failed to lodge the bonds with the Residential Tenancies Authority $($RTA$).$ The court heard that no repayment of trust funds had occurred between the commencement of the investigation and the date of sentence. The court also heard that while Mr Wright first appeared before the court on $12$ November $2018$ and was placed on bail, he continued to breach the law and was charged with three further offences on $19$ March $2019.$ In sentencing$,$ Magistrate Joe Pinder said the nature of Wright$$s offending was lengthy, persistent and against the most vulnerable members of the community. He noted that the defendant continued to offend despite previous prosecutions by the RTA and following previous enforceable undertakings with OFT. Fair Trading Executive Director Brian Bauer said the OFT$$s work ensures property licensees are acting lawfully and in the best interests of their clients. $$Trust money does not belong to property agents,$$ Mr Bauer said. $$Penalties like that handed to Mr Wright today should remind agents just how seriously the community, the OFT, and the courts consider improper use of trust money. $$Clients pay large sums of money to property agents to manage their assets, and tenants trust that agents are dealing with their bond and rental money properly. $$Today$$s result came about through information OFT obtained during Operation Bond, a joint agency crackdown by the OFT and RTA targeting agents suspected of mishandling bond money. $$The OFT is committed to weeding out agents who damage the integrity of the property industry in Queensland. We will not hesitate to seek high penalties and disqualifications where appropriate.$$ Information about trust account obligations, including a guide for real estate agents, is available on the OFT website at www$.$qld$.$gov.au$/$fairtrading$.$

ENDS

Last updated:$23$ October $2020$

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