A property agent has been fined S$30,000 and suspended 12 months for being unprofessional and unethical in a property transaction, said the Council for Estate Agencies (CEA) on Monday (Oct 21).
This is the highest fine and longest suspension meted out to a property agent, the statutory board said in a media release.
PropNex Realty agent Ngu Ping Chuan James Ethan, also known as James Ngu, 39, made offers to a seller of a condominium unit without his client’s knowledge, and did not tell his client about the seller’s counter-offers.
He also tried to negotiate a 3 per cent commission from the seller, but when the seller refused, he told his client not to buy the property.
Ngu was engaged by a client in 2016 to source for a home in the price range of S$900,000.
In March 2017, Ngu and his client viewed a condominium unit in the eastern part of Singapore priced at S$1.04 million. After the viewing, Ngu told the seller’s agent that his client was keen on the property and asked about the commission payable to him.
The seller’s agent informed Ngu that his client was willing to sell the property at S$1.02 million, and to pay Ngu a commission of 1 per cent, which was about S$10,000.
But Ngu said he wanted a commission of 2.5 to 3 per cent, and did not tell his client about the seller’s offer. Instead, he told his client the property was valued at S$1.18 million on average and suggested an offer of S$1.06 million.
However, his client’s own checks with a bank showed that the estimated value of the property was S$950,000 to S$1 million.
NGU WANTED 3% COMMISSION
In April 2017, Ngu’s client told him to start negotiations for the purchase of the property on his behalf.
Two days later, Ngu told his client that he had conveyed an offer of S$950,000, but it was rejected. Ngu then told his client that the seller had made a counter-offer of S$1.04 million when there was no such offer made.
Without his client’s instructions, Ngu told the seller’s agent that his client was willing to purchase the property at S$1.04 million, with a commission of 4 per cent to be paid by the seller and shared between both agents. Ngu asked for 3 per cent commission for himself, which was about S$30,000.
The seller rejected the offer and offered instead to pay a commission of 2 per cent to Ngu, and 1 per cent to his own agent, which Ngu rejected. The seller’s agent also counter-offered a sale price of S$1.01 million, with Ngu collecting commission from his own client instead, which Ngu did not convey to his client.
Ngu advised his client against buying the condominium unit, citing the high price, despite the actual reason being his failure to negotiate for himself a 3 per cent commission, CEA said.
His client eventually contacted the seller’s agent directly and offered to purchase the property at S$1.04 million, which the seller accepted.
CLIENT SUFFERED LOSS OF S$20,000 TO S$30,000
CEA said Ngu’s “wrongful conduct” caused his client to suffer a loss of between S$20,000 and S$30,000 in the transaction.
Ngu pleaded guilty to three charges under the CEA Code of Ethics and Professional Client Care – failing to convey the seller’s offer of S$1.02 million to his client; failing to declare in writing his conflict of interest in getting a co-broke commission; and failing to convey to his client the seller’s counter-offer of S$1.01 million, with his commission to be paid by his client.
Five other charges were taken into consideration.
He was fined S$30,000 and suspended for 12 months for each charge, with the suspensions to run concurrently starting from Oct 16.
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In its media release, CEA said consumers who choose to have a property agent should “seek clarification from their agents” if they have doubts on conflicts of interest.
“Consumers should be informed in writing of any conflict or potential conflict of interest which may arise at any time during the property transaction,” CEA said.
“If there is indeed a situation of conflict of interest, consumers would have to give their consent to their property agents before their agents could continue to act for them.”
Source: 21 Oct 2019