As a licensed property agent, Netstrata is required by law to hold our client’s funds in trust accounts with an authorised New South Wales financial institution, which is approved by the Commissioner of Fair Trading.
The Property, Stock and Business Agents Act 2002 is the legislative Act containing the relevant provisions.
Section 86 states:
(1) Money received for or on behalf or any person by a licensee in connection with the licensee’s business as a licensee:
(a) is to be held by the licensee or (if the licensee is employed by a corporation) by the corporation, exclusively for that person, and
(b) is to be paid to the person or disbursed as the person directs, and
(c) until so paid or disbursed is to be paid into and retained in a trust account (whether general or separate) at an authorised deposit-taking institution in New South Wales and approved by the Director-General for the purposes of this Part.
(2) If the licence is held by a corporation, the trust account is to be in the name of the corporation and in any other case is to be in the name of the licensee or of the firm of licensees of which the licensee is a member.
(3) The name of a trust account and the description of the trust account in the books and records of the licensee and also on all cheques drawn on the trust account:
(a) must include the name of the licensee corporation, licensee or firm of licensees in whose name the trust account is kept, and
(b) must include the words “Trust Account”, and
(c) may include, at the end of the account’s name, a name or other matter to identify the person on whose behalf money in the account is held.
(4) When opening a trust account at an authorised deposit-taking institution for the purpose of complying with this section, the licensee concerned must ensure that the authorised deposit-taking institution is notified in writing that the account is a trust account required by this Act.
(5) A licensee must, within 14 days after closing a trust account, notify the Director-General in writing of the closure.
While the law compels licensees to place funds into a trust account, at Netstrata we believe in maximising the potential for surplus funds sitting in these accounts.
That’s why we’ve explored the different options available at the numerous approved financial institutions and selected Macquarie Bank as our preferred financial institution.
Netstrata selected Macquarie Bank for a number of reasons. Macquarie Bank has invested heavily in their systems, which are compatible with ours, for easy downloads of payments and BPAY payments to creditors. This creates internal efficiencies and reduces errors. They also offer a number of payment facilities for our clients. As market leaders, Macquarie Bank, understands the industry and have competitive rates for investment and term deposit accounts.
At Netstrata, our strata managers regularly monitor the trust accounts to ensure our clients’ funds continue to perform to their full potential.
When opening a new trust account, by law, we’re required to notify Macquarie Bank in writing that we require a trust account and it’s to be in the name of the corporation. When closing the account, we’re required to notify the Director-General of the closure.
There are also legal obligations for the financial institution. They must tell the Director-General the number of trust accounts opened and closed during the previous month. They must also submit monthly reports on their active trust accounts to the Director-General.
If you have any questions regarding the funds contained in your trust account, don’t hesitate to contact your strata manager at Netstrata.