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Purplebricks Australia fined £11,200 after regulator receives complaints about its fixed fees

Queensland fair trading regulator slaps fine on hybrid agent and forces it to enter into three-year-long undertaking.

Nigel Lewis

Purplebricks Australia

Purplebricks Australia has been fined AU$20,000 (£11,200) by the Queensland Office of Fair Trading (OFT) following complaints that it had misled customers about its fixed-fee offering, and not followed accounting and other business rules.

OFT says it received “several complaints” about misleading claims both on Purplebricks’ website and within advertising.

In a similar way that some consumers and agents complain about Purplebricks in the UK, it was claimed that Purplebricks was not clear that its fees were charged whether a property is sold or not.

“Between November 2016 and June 2017, Purplebricks Australia Pty Ltd, entered into agreements with consumers who were not made aware of the terms of the fees charged,” a statement from the Queensland Office of Fair Trading says.

Purplebricks Australia

“Consumers were also misled about additional services offered by Purplebricks, despite the agency advertising ‘low, fixed fees’ for their services when selling property.

“Purplebricks [also] failed to fulfil some of its regulatory obligations about use of appropriate accounts software, use of a non-Queensland bank account and notification of substitute licensees and other places of business.”

In a statement to Australian website Financial Review, Purplebricks’ CEO in Australia, Ryan Dinsdale (pictured, above), said his company had worked with the regulator to be “open and transparent” about its model, and that Purplebricks would “always act on feedback to ensure we display everything as clearly as possible”, he said.

“Accordingly, we have agreed to make some adjustments to wording to improve clarity and understanding.”

Purplebricks has entered into two enforceable undertakings with the regulator which will last for three years.

“Queenslanders have the right to expect that real estate agents will make accurate and honest agreements with their clients,” said the Queensland OFT’s Acting Executive Director Craig Routledge, who also said he acknowledged Purplebricks had amended its website prior to the fine.

“If real estate agents breach laws and industry regulations, the OFT will not hesitate to investigate and pursue if required.”

 

 

 

March 7, 2018

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