The low some people will go
Hearing about instances of fraud is pretty much the norm these days.
People pray on the vulnerable (quite often the elderly), pretending to be someone they are not and swindling money from the unsuspecting.
Unfortunately, the Property Management industry is not immune.
Bond theft remains the number one misappropriation of funds within the Property Management industry.
Do some Agents have their heads in the sand? As to us, it seems quite incomprehensible that there is confusion about whether bond money should be placed in the Trust Account or the General Account.
Don’t even get us started on the holiday rental industry.
Types of Trust Account monies
So bond money is one example.
There are many other types of Trust Account monies that should always be directed straight into the Trust Account.
These include:
- Residential rent
- Commercial/retail rent
- Sale deposits
- Advertising money
- Strata levies
- Sale options, off-the-plan sales, expressions of interest
- Stock & equipment purchases
The introduction of Rental Bonds Online
Enough was enough and rental Bonds Online was introduced to minimise the misappropriation of bond money.
We have covered in a previous blog how Rental Bonds Online works and how to sign up.
What to do with Bond Money
It is really very simple. This is why it is even more laughable that people continue to get it wrong.
If you are an agent:
You have 10 days following the end of the month to lodge all of the bonds collected in the previous month.
If you have a private rental:
The Landlord has 7 days from receiving the bond to lodge it with the Rental Bond Board.
The latest scams
So redirecting bond money is one thing.
But we have heard of some absolute crackers lately as people try newfangled ways to scam people, and they involve your suppliers.
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Changing supplier details
Scammers advise of a change to a supplier’s details. If this happens to you – ring the alarm bells!
If you receive this type of notification (even in writing), ALWAYS ring your supplier direct to confirm the change. It is amazing how easy it is to devise a very legit-looking email to imitate a supplier.
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Agent/Supplier cahoots
This one is upsetting and by no means are we implying that it is a regular occurrence. Yet, whispers along the grapevine have shown it is happening more often than we would like to hear.
Some Agents are in cahoots with their suppliers, convincing suppliers to add extra to their chargeable fees. Agent awards supplier the job and receives a nice little kickback. Nice kickback until you are caught and done for fraud.
At the end of the day, it doesn’t matter what industry you are in, there are always going to be honest and dishonest people. We can only hope the dishonest ones get weeded out and our industry is left with the hard-working, honest and fair ones!
Jane Morgan is the Director of End of Month Angels, a consultancy firm specialising in Trust Accounting. Jane knows the legislative requirements of running a successful Real Estate office through her 25 years’ industry experience. Don’t trust just anyone with your trust accounting. Book an appointment with an End of Month Angel today.