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The former Torquay agent will spend time behind bars for trust account mishandling and deficiencies.
Richard Michael Hayden, the former director and officer in effective control of Skyline Developments, pleaded guilty to three offences under the Estate Agents Act 1980 to County Court on 5 June.
This includes two charges for causing almost $1.6 million in trust account deficiencies and one charge for fraudulently transferring around $776,000 in trust funds for his own use.
In January 2022, it was reported Consumer Affairs Victoria received five complaints between November and December 2018 from consumers that Mr Hayden failed to return deposit money following settlement, or did not reimburse deposits following the cancellation of a contract of sale.
Subsequently, the Victorian consumer protection agency launched an official review of the company’s trust accounts, which revealed 50 instances of trust account deficiencies and 98 occasions of mishandled trust account funds by Mr Hayden.
Following the investigation, the Minister for Consumer Affairs launched a court proceeding and froze two of Skyline’s trust accounts in March 2019 and ordered that the company cease operations as an estate agent and appointed a statutory manager to wind down the business.
The court had heard that between 14 January 2018 and 7 June 2019, Mr Hayden used the wrongly transferred funds to pay for international holidays, entertainment, clothing, and medical costs.
On 16 June, the former agent was sentenced to 12 months in prison and a two-year Community Corrections Order in the County Court.
Director of Consumer Affairs Victoria Nicole Rich said the outcome is a stark reminder that estate agents who engage in misconduct will face significant consequences.
“Consumer Affairs Victoria will continue to hold real estate agents who misuse money to account, to protect buyers, vendors, and the integrity of the wider real estate industry.”
“Victorians deserve to know their money can be trusted with real estate agents and this outcome serves as a serious warning to agents doing the wrong thing,” she stated.
Consumer Affairs Victoria issued a reminder that estate agents and agents’ representatives must keep any consumer money held temporarily, such as property sales deposits and rental payments, in a trust account to ensure the funds are protected, emphasising the funds must not be utilised for general business expenses or personal use.
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