Ex-REIA president Malcolm Gunning and wife face charges over agency trust accounts

One of Australia’s leading real estate agents is accused of failing to maintain his own agency’s trust accounts amid allegations his wife misappropriated nearly $300,000 over four years.

Malcolm Gunning, the former president of the Real Estate Institute of NSW and the Real Estate Institute of Australia, is scheduled to face court next month to answer one charge of being a licensee who contravened the rule of conduct between December 2015 and May 2017.

His wife, Alice, faces five charges that relate to her conduct between October 2012 to December 2016 as a director of Guncom, the family company that owned their real estate business, Surry Hills-based Gunning Real Estate.

Fair Trading has accused her of knowingly commissioning a corporate offence by the corporation between October 2012 and June 2016, by fraudulently converting $278,237.29 – that was to be held in trust pending completion of transactions, to the use of her corporation.

She has been charged with one count each of being an agent making use of service provider not as prescribed, failing to properly supervise persons engaged in business, being a licensee who contravened the rule of conduct, failing to cause trust account records to be audited as required and fraudulently converting more than $5000.

Fair Trading alleges Mr Gunning failed to ensure his corporation’s trust was properly maintained and audited prior to December 2016 and that he failed to read the auditor’s reports in February 2017 for the financial years 2013-16 and as such failed to know that the account was in deficit.

It alleges Mrs Gunning was aware the property management trust account was in deficit since about June 2012.

Mr Gunning faces a maximum penalty of $5500 and the case is scheduled for March 7 at Parramatta Local Court.  Mrs Gunning faces a maximum of 10 years’ jail or a fine of $49,500. Her case will be mentioned at the same court on March 21.

The couple was first put on notice in a compliance blitz by Fair Trading in February last year. The business was fined $3300 and Mr Gunning was reprimanded for breaching the Property, Stock and Business Agents Act.

Following the same blitz, Mrs Gunning’s licence was cancelled and she was disqualified from holding another one for four years, as well as conducting or managing the business of a licensee.

An application was submitted to the Australian Securities and Investments Commission for the winding up of Guncom on December 3 — two days before the couple were issued their first court attendance notice.

Mr Gunning was president of the Real Estate Institute of NSW between 2014 to 2016. He went on to become president of Real Estate Institute of Australia from December 2016 to late 2018.

He made headlines last year after telling struggling Australians locked out of the housing market to get a second job.

“I don’t accept there’s a rental affordability crisis,” he told the ABC’s 7.30. “If you want to live on the fringe of the city, it’s affordable. If you want to live closer to the city, it is expensive.”