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Date [ 2014-01-03, 07:53 ]

First Two salespersons sentenced for moneylender referral.

(Kuala Lumpur=Koreanpress) by Ramani Rathir =  Two former real estate salespersons, Mustafa Kamal Bin Seri, 52 years old, and Ghazali Bin Mohamed Rasul, 39 years old were convicted and sentenced for referring their respective clients to moneylenders.  Ghazali is also the first salesperson to be prosecuted by the Council for Estate Agencies (CEA) for money-lending offences.

Mustafa was sentenced in court to a combined total of 11 and a half months of imprisonment and a total fine of S$18,000.  His sentence included an imprisonment of 2 weeks and a fine of $15,000 for CEA charges for referring his clients to a licensed moneylender and a further fine of $3,000 for handling transaction monies for his clients. 

He was also sentenced for two police charges of cheating, in respect of which two concurrent imprisonment terms of five months were imposed. Plus another police charge of criminal breach of trust as an agent for which six months of imprisonment was impose.

Ghazali was sentenced to an aggregate fine of S$18,000 for referring his client to a licensed money lender and receiving a referral fee from the moneylender. 

The details of the charges against both Singaporeans are as follows:

Mustafa Kamal Bin Seri

CEA had charged Mustafa, a former registered salesperson with Your Estate Specialist LLP when he committed the offences, in court on May 29, 2013.   In February 2012, a married couple engaged Mustafa to sell their four-room HDB flat and purchase a three-room flat in Yishun.  He subsequently approached his clients for a personal loan of $50,000 and requested that they borrow the sum from a moneylender to advance him the loan and repay the moneylender using the sales proceeds of their flat.
Between February and April 2012, Mustafa brought his clients to a licensed moneylender, 168 Credit Pte Ltd, to obtain three separate cash loans totaling S$57,500. 

The couple handed S$50,000 to Mustafa after the money lender deducted $7,500 as acceptance fees for the loans.   After the sale transaction was completed in May 2012, the clients repaid S$79,925 to the moneylender from the sales proceeds.  

Sometime in July 2012, the husband handed Mustafa S$15,000 in cash, which Mustafa then handed to his clients’ law firm in July 2012 to complete their purchase of the three-room HDB flat.

Mustafa’s case was aggravated as he had caused his clients to be indebted to a moneylender while he used the loan for his own benefit.  As a result, his clients could not afford to renovate their new flat to make it habitable.  They did not have the financial means to rent another home or to make other suitable arrangements and had to move into their resale flat in its existing state. 

They had to endure the situation for a few months before other agencies helped them with basic renovations for their flat.  Mustafa’s offences had caused great detriment to his clients.

Ghazali Bin Mohamed Rasul

CEA had also charged Ghazali, an ex-registered salesperson with PropNex Realty Pte Ltd when he allegedly committed the offences, in court on December 21, 2012.  Sometime in June 2011, Ghazali introduced his client to a licensed moneylender for an initial loan of $7,000.

Ghazali told the moneylender that his client would be able to repay the loan as he was selling his flat and he (Ghazali) was the salesperson handling the transaction.   The licensed moneylender gave the client $6,300 after deducting $700 as an upfront fee. 

The moneylender gave Ghazali a payment of $150 as referral fee. The client approached the moneylender for further loans.  After the sale transaction was completed in October 2011, the client repaid a total of $26,500 to the moneylender from the sales proceeds.

Ghazali had exposed his client to the risks of indebtedness to the latter’s detriment, even though his client had told him that he was in serious financial difficulties. His client had to repay the loans from the moneylender using proceeds from his flat’s sale transaction, in addition to paying the commission for the sales transaction to Ghazali.

Subsequently, his client was unable to afford a replacement flat as he could not get a loan from HDB or any bank. Since then, he has been renting a flat from the open market and risks becoming homeless once his savings have been depleted.
Ghazali was sentenced to a fine of S$10,000 for referring his client to a licensed moneylender and a fine of S$8,000 was imposed on him for collecting a referral fee from the moneylender.

CEA’s Advice for Consumers

It does not condone any collusion with moneylenders or involvement in moneylending activities by estate agents and salespersons. Estate agents and salespersons should not be involved in moneylending activities or abet unlicensed moneylenders in their criminal activities. 

They are not allowed to refer a client to any moneylender or receive any commission or other benefits from any moneylender relating to moneylending transactions.  Consumers are advised to report to CEA on any estate agent or salesperson who works in collusion with a moneylender. They can lodge a report with CEA at 1800-643 2555 or feedback@cea,gov.sg.

Consumers are also advised not to hand transaction monies to their salespersons. In a property sale and purchase transaction, transaction monies include option fee, downpayment, stamp duties, deposits and sales proceeds. Valuation fees and commissions are not transaction monies. abc@koreanpress.net

For more consumer tips and reference resources, consumers can visit the online Consumer Resource Centre on the CEA website: www.cea.gov.sg/ consumerresources.

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