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The truth, nothing but the truth

Hotblack Desiato estate agents - February 16 2...

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Johannesburg – Last year almost 3 000 estate agents‘ fidelity fund certificates, their “licence” to operate as estate agents in terms of the Estate Agency Affairs Act, were not posted to them.

It is estimated that 5 000 to 10 000 agents are operating illegally in South Africa.

The certificates are gathering dust in an office at the head office of the Estate Agency Affairs Board (EAAB) and were shown to Sake24 last week by EAAB chairperson Thami Bolani.

Bolani, who took over as chairperson in December last year, described this as a shocking example of the board’s ineffectiveness under the leadership of sacked chief executive Nomonde Mapetla.

This comes as no surprise, and substantiates agents’ allegations of the board dragging its feet in issuing the certificates during the year.

Bolani said that for the past six years under Mapetla’s management the board had failed to act as the industry‘s watchdog.

He also said that the organisation had been remiss in applying the law and agents had consequently taken advantage of the situation, while consumers had suffered.

For the past six years Mapetla had directed no more than 20 agency inspections a year.

The fact that there were more than 70 000 registered estate agents during the economic boom spoke volumes. Their number had since shrunk to 37 000.

Various instances of irregularities at agencies have come to light this year in the wake of the Wendy Machanik scandal in January.

Among the cases currently being investigated by the board is that of Seeff Fractional Ownership. This company allegedly took out mortgages on some of the sectional title properties and supposedly transferred them to some other properties as loans.

The activities of Dusty Moon Investments in Klerksdorp are also under scrutiny after the EAAB received an allegation of a significant shortfall in the company’s trust account.

Other companies being investigated include Constantia Sectional Title Management, Keith Wakefield Properties and Sunset Properties 106.

In South Africa recent investigations into agencies by several audit firms showed that only one in 34 complied with the requirements of the Estate Agency Affairs Act.

Most transgressions included invalid fidelity fund certificates, an absence of written mandates, inadequate bookkeeping and audits not having been done within the required period.

Bolani said more investigations were in the pipeline, but a witch-hunt was certainly not being directed at the industry. It was simply a process of cleaning up the industry and not every agent should be tarred with the same brush.

From discussions with some of the large agencies it would appear that the industry is in favour of a clean-up, he said.

Although huge challenges remain, he believes they are surmountable and the industry can look forward to new beginnings.

The board has already launched a dramatic turnaround strategy, starting with an amnesty period extending from April 15 to July 15, offering agents an opportunity to get their houses in order.

Against the background of its delay in issuing certificates, the board plans to establish a discrete section for registrations, where agents can also register online.


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