Auckland realty boss caught in elaborate sting

A realty boss admitted he should have told investigators that a man he had sold his franchise to was doing real estate work without a licence. Photo / Michael Craig

A realty boss who allowed an unlicensed man to market and sell homes in breach of the law was caught out in an elaborate sting by investigators.

Colin Boyer was principal of Century 21's Pakuranga Realty Ltd. But the respected real estate professional has pleaded guilty to reckless misconduct and is now awaiting a penalty decision.

Boyer sold his franchise to South African Herman Cloete in October 2013. The conditions of sale included an agreement that Boyer would provide technical and legal advice for three years while overseeing the operation.

Cloete agreed to become licensed within three years, but failed to comply with this condition.

In January 2014 Boyer was hospitalised with an illness and reduced his workload on medical advice, spending less time in the agency as the licensed agent.

In June 2014 the owner of three properties at Gwenand Place contacted the agency and discussed listing them for sale.

Cloete offered to market and sell the homes and the woman signed an agency agreement with him, a summary of facts states.

He prepared the listing agreement and forged Boyer's signature. Though unlicensed, Cloete was also listed on marketing material for the properties.

Boyer allowed Cloete to run open homes and admitted to an informant that Cloete was looking after the sales as Boyer was hardly ever in the office, the summary says.

After receiving a tip-off, an investigator from the Real Estate Agents Authority (REAA) posed as a potential buyer by phone. The next day the investigator was shown one of the properties by Cloete and given advice on how to proceed with an offer.

Cloete admitted he was not a real estate agent, but told the undercover sleuth he was the principal of Century 21 "and the investigator could still deal directly with him throughout the process as he would just get an agent to sign off the technical details".

Boyer later admitted to investigators he should have cancelled the listing agreements, relisted the properties and reported Cloete to the REAA for undertaking real estate work without a licence.

Boyer voluntarily suspended his licence in March this year and is no longer working in real estate. He could not be reached for comment.

"Mr Boyer knew that Mr Cloete was undertaking unlicensed real estate agency work and took no action to stop him," charge sheet details read.

"To the contrary Mr Boyer had facilitated this consequent on the arrangements made when Mr Boyer sold his business to Mr Cloete."

Cloete subsequently returned to South Africa and neither Boyer nor REAA investigators have been able to locate him.

If convicted of unlicensed realty work, Cloete could face a maximum fine of $40,000 for an individual, or $100,000 for a company.

The Herald sent questions to Century 21 national manager Geoff Barnett asking how an unlicensed person was able to purchase a franchise then market and sell homes in breach of the Real Estate Agents Act, and what knowledge Century 21 had of Cloete's current whereabouts.

Barnett replied: "Century 21 is pleased both (Boyer and Cloete) are no longer in the real estate industry."