You are here: Home - Mortgages - First Time Buyer - News -

Estate agents fined for forming illegal cartel

0
Written by: Owain Thomas
18/09/2017
The competition watchdog has fined six estate agents a total of £370,000 for forming a secret cartel to artificially raise commission rates.

The Competition and Markets Authority (CMA) fined the group a combined £370,084 – although one member was let off for being the first to confess its participation and for its co-operation.

The regulator said: “This is the second time the CMA has taken enforcement action against estate agents in recent years, and raises concerns that estate agents do not properly understand the seriousness of anti-competitive conduct and the consequences of breaking competition law.”

Gang of six

The gang of six estate agents met in early 2014 and agreed to fix minimum commission rates at 1.5% with the aim of making the agents involved more money.

However much of their plans were made over email, which proved a significant source of evidence for the CMA investigation.

“With a bit of talking and cooperation between us, we all win!” was the initial aim with the “intention of making as much profit as possible”.

At the meeting they formed the illegal cartel – by agreeing not to compete with each other and then took steps to ensure the minimum fee was kept to by emailing when a specific issue arose, such as accusations of “cheating” on their agreement.

Each business also took it in turn to “police” the cartel to make sure everyone was sticking to the agreement – parties were to report any issues “to the policeman immediately and get the matter resolved rather than let it fester and risk the agreement falling apart!!!!”.

Four confessions

All the estate agents were based in the Burnham-on-Sea area in Somerset.

They were: Abbott and Frost Limited; Annagram Estate Agents Limited (trading as ‘C J Hole’); Gary Berryman Estate Agents Ltd (and its parent company Warne Investments Limited); Greenslade Taylor Hunt; Saxons PS Limited and West Coast Property Services (UK) Limited.

Annagram Estate Agents was not fined for being the first to confess its participation in the arrangement under the CMA’s leniency policy and co-operated with the CMA’s investigation.

Four agencies Abbott and Frost, Gary Berryman, Greenslade Taylor Hunt and West Coast also admitted their participation to the CMA early on in the investigation and thus their fines included a discount to reflect savings due to their admissions and co-operation.

Fines for West Coast and Greenslade Taylor Hunt also included reductions for leniency under the CMA’s leniency policy.

Tackling sector issues

CMA senior director of cartel enforcement Stephen Blake warned that estate agencies continued to be a target of the CMA.

“Cartels are a form of cheating. They are typically carried out in secret to make you think you are getting a fair deal, even though the businesses involved are conspiring to keep prices high,” he said.

“We are committed to tackling cartels regardless of the size of the businesses involved. We have taken action against estate agents before, and remain committed to tackling competition law issues in the sector.”

National Trading Standards estate agency team head James Munro added: “We welcome the CMA’s reminder to the property sector of the importance of competition law.

“Being part of a cartel can have serious consequences for both businesses and individuals, so it is crucial that estate agents are aware of their competition law obligations.

“As the industry regulator we use cases like this as a trigger to assess the fitness of an individual or business to engage in estate agency work. This can lead to a formal warning or lifetime ban in engaging in this work.”

There are 0 Comment(s)

If you wish to comment without signing in, click your cursor in the top box and tick the 'Sign in as a guest' box at the bottom.

Are you a first-time buyer looking for a mortgage?

Look no further, get the help you need by searching for your perfect mortgage

Five ways to get on the property ladder without the Bank of Mum and Dad

A report suggests the Bank of Mum and Dad is running low on funds. Fortunately, there are other options for st...

The essential Your Money guide to the April 2018 tax changes

As we head into the 2018/19 tax year, a number of key changes take place to existing policies while some new i...

A guide to switching energy provider

All you need to know about switching from one energy supplier to another.

What will happen if rates change

How your finances will be impacted by a rise in interest rates.

Regular Savings Calculator

Small regular contributions can build up nicely over time.

Online Savings Calculator

Work out how your online savings can build over time.

Having a baby and your finances: seven top tips

We’re guessing the Duchess of Cambridge won’t be fretting about maternity pay or whether she’ll still be...

Protecting family wealth: 10 tips for cutting inheritance tax

Inheritance tax - sometimes known as 'death tax' - can cause even more heartache for bereaved families. But th...

Travel insurance: Five tips to ensure a successful claim

Ahead of your summer holiday, it’s important to make sure you have the right level of travel cover or you co...

YourMoney.com Awards 2018

Now in their 21st year, our awards recognise the companies offering the best products and services to consumers

Money Tips of the Week

Read previous post:
2345469-oldpeople
Brits taking later life planning seriously

Two surveys have found that, contrary to a number of recent reports, people are taking provision for old age seriously.

Close