Six LJ Hooker real estate branches collapsed this month after the couple running the businesses are investigated for misappropriating their client’s money. More than one hundred clients are owed substantial sums of money.
The six branches in Melbourne were shut down by the company’s head office last week with customers claiming that hundreds of thousands of dollars in deposits had gone missing. The owner of the closed franchises Judy Thanh Truc and her husband Joseph Ngo, are accused of spending home deposits that were supposed to be held in trust for their clients.
Ms Truc denied that she had stolen the money.
“Someone tried to hack my trust account,” Ms Truc said. “I don’t know what we are going to do now.”
Ms Truc said she was unable to provide more details because the matter was now in the hands of Consumer Affairs Victoria. She said she had notified LJ Hooker’s head office of the alleged breach of her bank account.
The LJ Hooker head office strongly refuted Ms Truc’s claims. In a statement, LJ Hooker said: “On 20th April, the day prior to termination of the franchise agreement, Judy [Truc] informed LJ Hooker for the first time that her partner, Joseph Ngo had misused trust funds. At no time did Ms Nguyen say that her trust account had be hacked. Prior to 20 April, LJ Hooker had not been notified that money had been wrongfully taken from the trust accounts.”
Retired house painter Jan Melah sold his Dandenong house in January through the Keysborough branch of LJ Hooker. He said he chose LJ Hooker because they were a trusted brand with an international reputation.
“LJ Hooker have got a good name so we sort of selected LJ Hooker and they told us they had a very good success in the region so we gave everything to LJ Hooker,” Mr Melah said.
Mr Melah and his wife Katarina reached settlement on their Dandenong home in March and expected the buyer’s deposit of $61,000 to electronically transferred into their bank account.
However, a day after settlement Mr Melah said he was called by an agent at LJ Hooker and asked to pick up a cheque from the office.
Instead of being given a bank cheque, Mr Melah said he was given a personal cheque to the value of $61,410. The cheque was dishonoured by the bank when Mr Melah tried to deposit it.
“A few days later we received a call from LJ Hooker to come, that they wrote a wrong cheque,” Mr Melah said.
He said Mr Ngo told him the business would pay Mr Melah $1,000 compensation and transfer the money directly into his bank account. The money never arrived.
“When I went to a bank I discovered that the money’s not been paid so we went straight away to speak to Judy,” Mr Melah said. “She said ‘I’m sorry we are having some difficulties but we will pay you $2,000 compensation now and we will put money into your bank on Monday, it will be there’.”
Mr Melah is yet to receive any of the money.
Real Estate Agent Makes Profit of $725k in Four Months
Meanwhile, in New Zealand, a real estate agent helping two pensioners sell their home has been sacked after buying the property for $530,000 and selling it less than four months later for $1.255 million – a profit of $725,000.
The former owners, brothers Jack and Walter Tata, both in their 70s, were stunned to learn of Mr Hughes’ windfall. They said they had no idea the property, bequeathed to them in their parents’ will, was worth so much.
At the time, they had considered the sale price “fair enough”, though suspected it was worth “a little bit extra” due to its location and development potential.
The dated, three-bedroom, 1950s house has cracked paint, worn carpet and a basic kitchen and bathroom. But it sits on a flat, 1075sq m section near Sylvia Park Mall and is sub-dividable with development potential.
Mr Hughes had “set everything up”, including the South Auckland law firm which processed the transaction, Jack Tata said.
Consumer advocate Neil Jenman says treacherous “bird-dog” real estate agents, who locate deals for investors and speculators while still charging their sellers commission, should be busted “big time” – as ultimately happened to the agent in this first tale.
Warren and Rose West’s New Zealand home had been on the market for some time, but they received only one low offer despite reducing their price. Then they became motivated, if not desperate, sellers when they contracted to buy another home subject to selling their own. Their “window of opportunity for an advantageous sale” (as one judge subsequently put it) was limited, if they were to proceed with that purchase. So they quickly sold for $2.75 million, even though they felt their home was worth about $3 million.
Wests had discovered, to their dismay, that within six months their buyer, Dave Dagg, on-sold through KiwiRealty to an overseas buyer for $3.555 million. Admittedly Dagg made some improvements, conducted an aggressive international sales campaign in a rising market, but Wests felt betrayed.
They then sued KiwiRealty after dismally discovering further that its real estate agent Jenny Spink had not revealed while handling their sale, that she knew Dagg often purchased properties to resell at a profit. Nor did she disclose KiwiRealty’s ongoing “bird-dog” relationship with Dagg and, in particular, its involvement in several of his previous wheeler-dealing purchases and resales.
If you are considering purchasing or selling real estate, make sure you always obtain independent legal advice – and don’t sign anything without having the contract checked independently. Tim O’Dwyer says:
“Real estate agents are rarely prosecuted or sued. Sure, we regularly hear about misbehaviour in the real estate industry and occasionally a real estate agent appears in court, but this is a rarity compared to the level of misbehaviour and misconduct encountered by consumers on a day to day basis. The reason for the low rate of court actions against real estate agents is the reluctance of consumers or their representatives. Consumers cannot match the dollars real estate agents are able to invest in court action.”
It is therefore easier to avoid getting scammed by a dishonest real estate agent in the first place. Contact us today for your free, 10-minute phone consultation.