This article is from the Australian Property Journal archive
THE Federal Court has slapped Quantum Housing with a $700,000 fine for sending a series of misleading letters and emails to at least 450 investors who had rental dwellings participating in the National Rental Affordability Scheme.
Between February 2017 and July 2018, Quantum pressured the investors to terminate their arrangements with their existing property managers and instead use property managers approved or recommended by Quantum.
The Western Australia based company failed to tell investors that it had commercial links with the property managers it recommended, and Quantum also told some investors that their existing property manager had not properly managed their property’s compliance with the NRAS, when this was not true.
“This conduct was blatant, planned and deliberate in an effort to trick investors into switching from their preferred property managers,” Australian Competition and Consumer Commission chair, Rod Sims said.
The Court also ordered Quantum’s director, Cheryl Howe to pay $50,000 in penalties for being knowingly concerned in Quantum’s breaches of the Australian Consumer Law. Howe was also disqualified from managing a corporation for three years.
Quantum and Howe admitted liability and made joint submissions to the Federal Court with the ACCC.
The corporate watchdog had also alleged that the conduct engaged in by Quantum was unconscionable conduct, but the Court decided against this, concluding that the admitted conduct did not depend on exploiting vulnerability on the part of investors.
