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Estate agents increase fidelity trust

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Cape Town – The embattled Estate Agencies’ Affairs Board (EAAB) has increased its fidelity trust to R589m, according to its annual report tabled in parliament on Tuesday.

The report paints a picture of a struggling board, which prompted Human Settlements Minister Tokyo Sexwale to intervene by placing the EAAB under administration last month.

Estate agencies and individual realtors contribute to the fidelity fund, which makes pay-outs to complainants when cases of wrongdoing are brought to the board.

The annual report showed claims on the fund had increased to R10.4m.

“The board approved R3.8m, and rejected claims of R2.5m, while claims of R4m are still pending,” EAAB CEO Bryan Chaplog said in an overview of the report.

Chaplog said an in-house inspectorate would be established to ensure there were no unregistered agents working, and to ensure those who were legally operating played by the rule book and if not, were censured.

“Specific concern is that there were 301 primary trust account contraventions out of a total of 652 inspections conducted.”

The board said it aimed to double the number of inspections at estate agencies.

Chaplog said the board’s inspection statistics showed that 100 estate agencies were operating illegally, and that there had been several contraventions of the code of conduct.

The breaches related to sole mandates, lease agreements, sale agreements and contracts in general.

The number of disciplinary procedures instituted against agents had also increased, from 172 in the 2010/11 financial year to 214 by April this year.

In the 214 procedures, there were 140 guilty findings and 32 acquittals. The other 42 cases were still pending.

Last month, Sexwale appointed lawyer Taswell Papier as administrator of the EAAB, to urgently clean it up.

Sexwale cited a series of “disturbing events”, including the Wendy Machanik saga, the acrimonious departure of the EAAB’s CEO Nomonde Mapetla, and the Auction Alliance debacle.

At the time, Sexwale said it was unclear how deep the rot was, but that Papier and the special investigating unit would get to the bottom of it.

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Post source : http://www.fin24.com/Companies/Property/Estate-agents-increase-fidelity-trust-20120925

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