Former Ray White agent reportedly being prosecuted in multi-million dollar property scam investigation
Former Ray White real estate agent, Michael Kollosche, is being prosecuted by Queensland Fair Trading for his alleged part in a Gold Coast beachfront property scam, The Australian reports.
It reportedly has access to documents lodged by the Queensland Crown Solicitor which claim Kollosche failed to disclose information about secret put and call options in prestigious Mermaid Beach properties.
The scam allegedly duped property buyers into over-paying for multimillion-dollar properties as part of an elaborate price-fixing scam.
The documents reportedly show Kollosche knew that put and call options misled buyers into believing properties had sold for millions more than the actual hidden sale price.
A put and call option is a combination of a call option, where a party has the enforceable right to buy something at a future time at a particular price, and a put option, which allows the vendor the right to compel the buyer to buy an asset at a specific price in the future.
In real estate they ostensibly achieve much the same effect as a conventional contract, but can be popular in new developments to delay paying stamp duty fees, but they also allow greater flexibility for buyers to transfer their interest.
They are also a legal way of buying a house then reselling it before settlement.
In the case of the Mermaid Beach transactions it is alleged the scheme was used to inflate prices with the money for the higher-priced second sale never changing hands, but the higher sales price recorded in the official property records.
The Fair Trading inquiry started in May 2010 when then Queensland Minister for Fair Trading Peter Lawlor brought allegations of the investment scam to the attention of the Queensland Police.
At the time Lawler came to the conclusion that the transactions “stink to high heaven”.
“There's a fictitious component in the transactions. It makes you wonder what went on with all of those [Mermaid Beach beachfront] properties.
“The values in that area went crazy over a short period of time. There was almost a stock market-like frenzy about it as people were getting in and out and making a couple of million dollars at a time the agents were also receiving very big commissions,” Lawler said at the time.