UK-based online real estate business Purplebricks is rumored to have to pay a $20,000 penalty after being pulled up by the Office of Fair Trading Queensland, in Australia, over complaints from customers, who claimed the company was engaging in false and misleading conduct because of the way it advertised its fees.
Purplebricks markets itself as an “all-inclusive,” flat-fee model that sees agents take care of all marketing, promotion and selling of a property for a standard price. It formally launched into the Australian market in 2016.
Queensland’s consumer watchdog confirmed on Monday that Purplebricks had entered into two enforceable undertakings with the office over allegations it breached Australian Consumer Law and the Property Occupations Act through its actions between 2016 and 2017.
The Office of Fair Trading says that over this period, customers entered into agreements with Purplebricks but “were not made aware of the terms of the fees charged”.
This included concerns that customers were not properly informed that the “fixed fees” they were signing up to for the sale of a property were payable regardless of whether the property actually sold or if the agreement with Purplebricks was cancelled.
The watchdog also found Purplebricks had “failed to fulfil some of its regulatory obligations about the use of appropriate accounts software” and was using a non-Queensland bank account, which can be a breach of the Property Occupations Act in the state.
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