PROPERTY MANAGER FINED AFTER FALLING VICTIM TO A HOLIDAY ACCOMMODATION SCAM

A property manager has been reprimanded and fined $2,500 by the State Administrative Tribunal after falling victim to a holiday accommodation booking scam which resulted in a $45,000 loss for her employer, a Scarborough real estate agent.

The property manager had failed to exercise due skill care and diligence, in breach of the Real Estate and business Agents' Code of Conduct, when dealing with the fraud in October and November 2015 in which overseas scammers had used fake credit cards to pay for bogus holiday bookings.

Using the name 'Colonel Michael Warner', the scammer contacted the agency, which specialises in short-term rental accommodation at residential apartments in Scarborough, to make a booking for three groups totalling $53,449.  The scammer used seven credit cards to make the booking, three of which were declined.

At the scammer's request the property manager transferred $25,138 and $20,066 from the agency's trust account to the third parties supposedly to pay for translation and tour guide services in advance.  These funds have never been recovered. She went ahead after ignoring a warning from an office colleague that the requests were suspicious.

The property manager faced disciplinary action by Consumer Protection after failing to:

• ensure the caller completed and returned agency forms sent in respect to the bookings:
• follow the agency's practice of holding deposits in trust until all guests had vacated the accommodation;
• seek to verify the identities of the various credit card holders;
• seek to verify the identities of the third parties who received payment without providing any services or producing any invoices; and
• inform or seek instructions from the agency's principal prior to transferring the large sums of money from the agency's trust account and despite a colleague querying the legitimacy of the caller's behaviour and requests.

Commissioner for Consumer Protection David Hillyard expressed disappointment that such a large loss was incurred through the incompetence of an employee.

"Verifying the identity of people involved in financial transactions within the property industry is now at the forefront of all of the Department's training and communications with the industry," Mr Hillyard said.

"So it is disheartening that in this case scammers could use the agency as a vehicle to stead credit card holders' funds with relative ease, with not even the most basic checks being carried out."

"All principals of businesses in the property industry in WA must ensure that their staff, particularly those who are entrusted to operate the agency's bank accounts, are well trained in fraud prevention methods and exercise a high degree of vigilance."

"Agencies must have practices and procedures in place to assist staff recognise scam attempts in order to thwart them before the criminals are rewarded and losses are incurred by the business." 

(Makes me wonder just how old this property manager was, how many years in the industry has she had, why didn't the business have a procedure in place when transferring Trust Fund monies over there should have been a second person to okay that transaction.?  I dont believe the $2,500 dollar fine was enough quite frankly and I certainly hope she is no longer in the industry.  Having been done in 2015 two years ago and we are just hearing about it NOW !!

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