Thomas Kelly, branch manager of Connells’ West Bromwich office, was convicted under the Fraud Act over the purchase of three repossessed homes which the agency was marketing.
Kelly arranged to sell the properties to his wife Samantha and did so without declaring his personal interests to the seller between April 2009 and May 2011.
He registered the sales on Connells’ internal systems under his wife’s name, overrode the company’s internal audit processes and forged the signatures of other staff to cover his tracks. The pair subsequently sold the three properties and made a profit of £98,550.
However, the Connells office became aware of the activity and referred the case to the Office of Fair Trading.
Following the investigation and prosecution Thomas Kelly was sentenced at Wolverhampton Crown Court to six months’ imprisonment suspended for 12 months as well as a community supervision order for six months, including 180 hours of unpaid work. Samantha Kelly was sentenced to a six-month supervision order.
Another member of staff at the Connells branch, Andrew Butts, was convicted of a similar fraud in which he sold a property to his brother-in-law without declaration. This was sold, after minor cosmetic work, for a profit of £34,500. Butts was given a conditional discharge for 12 months.
Judge Dudley told the court: “The bedrock principle of the estate agent profession is a safeguard that there should not be a conflict of interest and you have all breached that.”
Stephen Blake, OFT head of criminal enforcement, said: “It’s vital the public can have confidence in the house buying market and that sellers can have confidence that the people entrusted to sell what will often be their most valuable asset will act in their best interests.
“The conduct of the convicted individuals in this case is particularly invidious, given that the properties in question had been repossessed. These prosecutions are a testament to how seriously the OFT takes this issue. Today’s sentences should stand as a deterrent to any other estate agent who may be tempted to engage in this kind of deception in the future.”
Elizabeth Brown, Divisional Managing Director for Connells, added: “We do not tolerate any wrongdoing from staff and are very pleased with the outcome of this case. After alerting the OFT to the fraudulent activity, Connells fully supported and assisted with the investigation.
“Although these are isolated incidents, we will always carry out an investigation should malpractice be suspected and will report anyone found behaving against industry codes of conduct or Connells own robust compliance policies to the appropriate authorities.”
