Estate agents fined £600,000 for fixing commission rates
Three estate agents have been fined a total of more than £600,000 for operating an illegal cartel to fix commission rates.
The three firms, all from Berkshire, were Michael Hardy, Prospect and Richard Worth. Together with a fourth company, Romans, they began fixing prices in September 2008.
They conspired to set minimum commission rates for the sale of residential properties in Wokingham, Winnersh, Crowthorne, Bracknell and Warfield – where they were the leading estate agents at that time.
This involved the firms exchanging confidential information on pricing and holding meetings to make sure all members enforced and maintained the agreed minimum rates.
The result was that homeowners were denied the chance of securing the best possible deal when selling their property because they were unable to meaningfully shop around all their local agents for better commission rates.
Romans will not be fined as it brought the illegal activity to the attention of the Competition and Markets Authority (CMA) and fully cooperated with the investigation, under the CMA’s Leniency Programme.
Michael Grenfell, Executive Director of Enforcement, said: “It is disappointing we’ve found yet another case of estate agents breaking competition law. We trust that the fines issued today will reinforce our message that we expect the sector to clean up its act and make sure customers are not being ripped off in this way.”
The total fines imposed take into account the behaviour of the companies involved. Michael Hardy’s and Prospect’s fines were discounted to reflect the fact they admitted to illegal behaviour and agreed to cooperate with the CMA, thereby shortening the length of its investigation.
Please contact Mandeep Singh if you would like more information about the issues raised in this article or any aspect of company and competition law.