PHOTO: ONE AGENCY BRANDING
One Up Realty operated a real estate trust account for more than six years without appointing the required auditor. The Tribunal called it misconduct. Property Noise asks the obvious question: how was this allowed to continue for so long?
Forget misleading listing photos.
Forget agents arguing over disclosure.
Forget social-media posts and advertising technicalities.
This one goes directly to something far more fundamental in real estate:
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Other people’s money.
The Real Estate Agents Disciplinary Tribunal has found One Up Realty Limited guilty of misconduct after the agency operated a trust account for more than six years without appointing an auditor and repeatedly failed to meet New Zealand’s trust-account audit requirements.
The punishment?
💥 Censure
💥 $18,000 fine
💥 Further trust-account training for the company’s officer
But the number that should make the real estate industry sit up isn’t $18,000.
It’s this:
275 transactions.
That’s how many transactions involved money passing through the trust account during the period in which no auditor had been appointed.
And this wasn’t something that slipped through the cracks for a few weeks.
It went on for more than six years.
The Timeline Is Extraordinary
One Up Realty opened its trust account on 24 August 2017.
Under the Real Estate Agents (Audit) Regulations 2009, an agency operating such an account is required to appoint a qualified auditor and comply with specific auditing and reporting requirements.
One Up Realty didn’t appoint its auditor until:
29 August 2023.
That’s six years later.
During that period, the account remained operational and received funds relating to 275 real estate transactions.
And it gets worse.
According to the Tribunal, this wasn’t a case where nobody had told the agency what it was supposed to be doing.
The REA had repeatedly reminded the agency of its obligations.
The Ministry of Justice summary says the failures included not appointing an auditor, not notifying the REA of an auditor appointment, not providing required monthly reconciliations and statements, and failing to obtain the prescribed audits.
Eventually, the agency admitted its conduct amounted to a reckless contravention of the legislation and pleaded guilty to misconduct.
That’s not an administrative typo.
That’s misconduct.
Why Trust Accounts Are Sacred Ground
Here’s why this matters.
Real estate agencies can receive substantial sums of money connected with transactions.
That isn’t agency money.
It belongs to clients and customers.
New Zealand law requires transaction money received by an agent to be deposited into a designated trust account. Agencies must keep records enabling the money to be traced and properly audited.
Auditors aren’t there for decoration either.
Trust accounts must generally be examined at least three times each year, with an annual audit report supplied to the REA. Monthly reconciliations also have to be provided to the auditor.
Why?
Because when someone hands money to a real estate agency, they shouldn’t have to simply cross their fingers and trust that everything is being handled correctly.
The audit is part of the protection.
Now Here’s the Important Part: The Money Wasn’t Found Missing
This distinction matters.
There is no finding that One Up Realty stole client money.
There is no finding that the trust funds disappeared.
There is no finding of fraud in this decision.
After an auditor was finally appointed, retrospective reports covering the 2018–2024 financial years did not identify irregularities in the handling of trust monies.
That’s important and shouldn’t be buried for the sake of a sensational headline.
But it also doesn’t make six years without the required independent oversight acceptable.
The point of an audit isn’t to discover a problem six years later.
It’s to provide oversight while the money is actually being handled.
A smoke alarm isn’t pointless because your house didn’t burn down.
REA Kept Reminding Them
Perhaps the most disturbing element of this case is that the agency wasn’t operating in complete ignorance.
The Tribunal specifically noted that the REA had reminded One Up Realty of its obligations “on multiple occasions.”
Think about that.
This wasn’t:
“Sorry, we didn’t realise.”
The regulator was contacting the agency.
There were notifications.
Requests for explanations.
Compliance information.
Reminders.
Yet the situation continued.
That helps explain why the Tribunal regarded the offending as serious and placed the fine toward the higher end of the available penalty.
The agency’s early admission and cooperation ultimately counted in its favour.
But Property Noise Has Another Question
The Tribunal has punished One Up Realty.
Fair enough.
But there’s an elephant sitting in the room:
How does a regulated real estate agency operate a trust account for SIX YEARS without an appointed auditor?
If the regulator was repeatedly reminding the agency of its obligations, why was escalation not faster?
At what point does:
“Please comply”
become:
“Stop handling client money until you comply”?
That’s not an allegation of wrongdoing by the REA. The published material doesn’t establish that the regulator had legal grounds at an earlier point to shut the account or agency down.
But it is a legitimate regulatory question.
Because if trust-account auditing is genuinely fundamental to consumer protection, six years is an awfully long time for non-compliance to continue.
275 Transactions Changes the Story
Had an agency opened an account, processed one transaction and discovered several months later that paperwork had been missed, you might reasonably describe it as a serious compliance failure.
But 275 transactions?
That’s scale.
Each transaction represented another occasion on which money entered a system that wasn’t receiving the independent auditing oversight required by the regulations.
Again, retrospective audits found no irregularities.
That’s excellent news for the people whose money passed through it.
But consumer protection systems aren’t supposed to operate retrospectively on good fortune.
They are designed to prevent the worst-case scenario.
$18,000 — Enough?
And that brings us to the uncomfortable question.
The agency was fined $18,000.
Over six years, that’s effectively:
$3,000 per year of unaudited operation.
Or approximately:
$65 for each of the 275 transactions.
Those aren’t legal calculations — they’re simply another way of putting the penalty into perspective.
Was $18,000 enough?
The Tribunal clearly regarded the conduct seriously. The Ministry of Justice summary describes the prolonged offending as more serious than comparable cases, while acknowledging the agency’s admission and cooperation as mitigating factors.
But consumers might reasonably ask whether a regulatory regime protecting potentially substantial sums of client money needs consequences strong enough to make prolonged non-compliance commercially unthinkable.
Real Estate Doesn’t Run on Houses. It Runs on Trust.
Agents love talking about trust.
“Trusted adviser.”
“Your local property expert.”
“Someone you can trust with your biggest asset.”
But trust isn’t a slogan printed on a bus shelter.
It’s systems.
It’s reconciliation.
It’s record keeping.
It’s independent auditing.
It’s compliance.
And it’s doing those things when nobody has discovered anything wrong.
REA Chief Executive Belinda Moffat said agencies handle significant client and customer funds and that failures around trust accounts can cause financial loss, reputational damage and undermine confidence in the industry.
Exactly.
Property Noise Take: The Fine Isn’t the Biggest Story
One Up Realty deserved the misconduct finding.
It admitted reckless contraventions.
The Tribunal imposed an $18,000 fine.
The company’s officer now has to undertake additional education.
But perhaps the bigger story isn’t the punishment.
It’s the system.
SIX YEARS.
275 TRANSACTIONS.
MULTIPLE REA REMINDERS.
NO APPOINTED AUDITOR UNTIL 2023.
Thankfully, retrospective audits found no irregularities with the trust money.
But imagine for a moment that they had.
Everyone would be asking exactly the same question:
How the hell was this allowed to go on for six years?
And perhaps the New Zealand real estate industry should be asking that question before something goes seriously wrong — not afterwards.
What do you think?
Is an $18,000 fine enough for more than six years of trust-account audit breaches involving 275 transactions?
Or should prolonged trust-account non-compliance carry far tougher consequences for a licensed real estate agency?
Have your say.
Official case information: REA – One Up Realty misconduct decision | Real Estate Agents Disciplinary Tribunal decisions