Yahoo Finance The illegal question your agent might be asking you
The federal government’s six-month eviction ban has sent renters and landlords into a frenzy this week, but real estate agents in the middle could find themselves on the wrong side of the law if they don’t tread carefully.
Agents snooping into your super balances could face maximum penalties of five years imprisonment and/or a fine of up $126,000, the Australian Securities and Investments Commission has warned - and their businesses could face fines of up to $1.26 million.
Also read: Prime Minister bans evictions for 6 months
Also read: Eviction ban leaves landlords thousands out of pocket
Here’s why
The government has encouraged landlords to enter into discussions with tenants to support them if they’re experiencing financial strain.
“My message to tenants, particularly commercial tenants, and commercial landlords, is a very straightforward one - we need you to sit down, talk to each other and work this out,” the Prime Minister said.
However, some real estate agents have instead met tenants’ requests for rent decreases with questions about their superannuation balance and their spending habits.
“I asked for a rent pause so my property agency demanded to know how much super I have and how much I spend on food,” Joshua Badge tweeted.
As part of the government’s coronavirus economic response package, the Australian Taxation Office has revealed it will let Aussies access their superannuation early, but ASIC has warned agents asking tenants to access their super can be considered giving financial advice, which is illegal.
“ASIC is aware that some real estate agents are advising tenants who are unable to pay their rent, or who may find themselves in such a situation in future, to consider applying for early release of their superannuation,” the corporate regulator stated.
The watchdog stated this conduct could constitute unlicensed financial advice, and not be in the interests of tenants.
“Financial advice must only be provided by qualified and licensed financial advisers, or financial counsellors, not by real estate agents who neither hold the requisite licence, nor are an authorised representative of an Australian Financial Services Licensee,” ASIC stated.
“Tenants facing financial difficulty need sound financial guidance and potentially debt counselling.
“Specifically pointing them to and recommending them to consider the specific possibility of accessing superannuation is, again, likely to amount to a breach of the Act.”
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