Div 2Trust accounts

Division 2—Trust accounts 13—Receiving and dealing with trust money (1) An agent, sales representative, property manager or any other person who receives trust money in relation to an agent must, as soon as practicable after receiving the trust money, deposit the money into an account (in the name of the agent) approved by the Commissioner at an ADI. (2) An agent, sales representative, property manager or any other person who is entitled to deposit trust money into, withdraw trust money from, or deal with trust money in, an agent's trust account must not— (a) pay money other than trust money into the trust account; or (b) withdraw, or permit another person to withdraw, money from the trust account except as permitted by, and in accordance with, this Part. (3) A person— (a) who receives trust money under subsection (1); or (b) who is entitled to withdraw or deal with trust money under subsection (2), must not cause a defalcation, misappropriation or misapplication of the trust money. (a) in the case of a natural person—$100 000 or 5 years imprisonment or both; (b) in the case of a body corporate—$250 000. (4) The Commissioner may, by notice in writing to an ADI— (a) approve accounts of a particular class (being accounts that carry interest at a rate considered satisfactory by the Commissioner) for the purposes of this section; or (b) vary or revoke any such approval. 14—Withdrawal of money from trust account Subject to this Part, money may only be withdrawn from a trust account for the following purposes: (a) for payment to the person entitled to the money or for payment in accordance with the directions of that person; (b) in satisfaction of a claim for commission, fees, costs or disbursements that the agent has against the person on behalf of whom the money is held; (c) to satisfy an order of a court or the Tribunal against the person on behalf of whom the agent is holding the money; (d) for payment into a court or the Tribunal before which proceedings have been instituted in relation to the money; (e) for the purpose of dealing with the money in accordance with the Unclaimed Moneys Act 1891; (f) for making any other payment authorised by law. 15—Payment of interest on trust accounts to Commissioner Interest that an ADI is liable to pay in respect of trust money held in a trust account must be paid by the ADI to the Commissioner on the days fixed by regulation. 16—Appointment of administrator of trust account (1) If the Commissioner knows or suspects on reasonable grounds that an agent— (a) is not registered as required by law; or (b) has been guilty of a fiduciary default in relation to trust money; or (c) has operated on the trust account in such an irregular manner as to require immediate supervision; or (d) has acted contrary to this Act or otherwise unlawfully or improperly or negligently in the conduct of the business; or (e) in the case of a natural person— (i) is dead or cannot be found; or (ii) is suffering from mental or physical incapacity preventing the agent from properly attending to the agent's affairs; or (f) has ceased to carry on business as an agent; or (g) has become bankrupt or insolvent or has taken the benefit (as a debtor) of a law relating to bankrupt or insolvent debtors or, in the case of a body corporate, is being wound up, is under official management or is in receivership, the Commissioner may appoint a person to administer the agent's trust account. (2) This section applies in relation to conduct occurring before or after the commencement of this Act. (3) The Commissioner must, as soon as practicable after appointing an administrator, give notice in writing of the appointment to— (a) the agent; and (b) all persons who are entitled (whether solely or jointly) to withdraw money from, or deal with money in, the account; and (c) the ADI at which the account is held. (4) A person who has been given notice of the appointment of an administrator, or who knows that an administrator has been appointed, must not withdraw money from, or deal with money in, the trust account while the appointment continues. (5) An ADI that has been given notice of the appointment of an administrator must not, while the appointment continues, accept any withdrawal of, or dealing with, money in the trust account unless the withdrawal or dealing is at the direction, or with the written approval, of the administrator. 17—Appointment of temporary manager (1) Where an administrator is appointed under this Division, the Commissioner may appoint that person or some other person to be a temporary manager to transact any urgent or uncompleted business of the agent. (2) The Commissioner must, as soon as practicable after appointing a temporary manager, give notice in writing of the appointment to the agent. 18—Powers of administrator or temporary manager The following powers may be exercised by an administrator or temporary manager: (a) the administrator or manager may require any person in a position to do so— (i) to produce documents and records relating to the agent's business including written records that reproduce in a readily understandable form information kept by computer, microfilm or other process; and (ii) to provide information relevant to the agent's business; and (b) the administrator may require any person in a position to do so to provide all authorities and orders to ADIs and others that may be reasonably required for the operation of the agent's trust account; and (c) the administrator or manager may take possession of documents and records forming part of the agent's business and for that purpose may enter business premises of the agent using such force as is reasonably necessary; and (d) such other powers as the Commissioner sets out in the instrument of appointment of the administrator or the manager. 19—Term of appointment of administrator or temporary manager (1) The appointment of an administrator or temporary manager remains in force for such period (not exceeding 12 months) as is specified in the instrument of appointment unless sooner terminated by the Commissioner or the Tribunal. (2) Subject to an order of the Tribunal to the contrary, the Commissioner may reappoint an administrator. 20—Review of appointment of administrator or temporary manager (1) An agent may, within 28 days after receiving notice of the appointment of an administrator or temporary manager, seek a review of the appointment by the Tribunal under section 34 of the South Australian Civil and Administrative Tribunal Act 2013. 21—Keeping of records (1) An agent must keep detailed records of all trust money received by the agent and of any disbursement of, or other dealing with, that money and must compile detailed accounts of those receipts and disbursements that— (a) accurately disclose the state of the trust account maintained by the agent; and (b) enable the receipt and disposition of trust money to be conveniently and properly audited; and (c) comply with all other requirements specified by regulation. (2) In particular, the agent must, in respect of the receipt of trust money— (a) make available to the person making payment a receipt that sets out the information specified by regulation in the form specified by regulation; and (b) make and retain a copy of the receipt as part of the agent's records. (3) An agent must, at the request of a person who has an interest in trust money, provide that person with a statement setting out details of dealings by the agent with the money. (4) An agent must keep the accounts and records referred to in this section or a corresponding previous enactment in a legible written form, or so as to be readily convertible into such a form, for at least five years. 22—Audit of trust accounts (1) Subject to this section, an agent who maintains a trust account must— (a) ensure that the accounts and records kept under this Division are audited by an auditor in respect of each audit period specified by regulation in accordance with the requirements prescribed by regulation; and (b) lodge with the Commissioner a statement relating to the audit that sets out the information specified by regulation. (1a) If no trust money was held in an agent's trust account during a particular audit period, no audit or statement is required under subsection (1) in relation to that period but the agent must make and lodge with the Commissioner a declaration, in a form approved by the Commissioner, setting out the reasons for not holding any money in the trust account during that period. (2) An agent, who did not maintain a trust account during a particular audit period, must make and lodge with the Commissioner a declaration, in a form approved by the Commissioner, setting out the reasons for not maintaining a trust account during that period. (3) An agent who— (a) fails to have accounts and records audited as required; or (b) fails to lodge an audit statement or a declaration required under this section within the time allowed by or under the regulations, is guilty of an offence. (4) Where an agent fails to lodge an audit statement or a declaration required under this section within the time allowed by or under the regulations, the Commissioner may, by notice in writing, require the agent to make good the default. (5) Where the agent fails to comply with the notice within 28 days after service of the notice, the agent's registration is cancelled. (6) The Commissioner must notify the agent of the cancellation of the agent's registration. 23—Appointment of examiner (1) The Commissioner may, at any time, appoint a person— (a) to examine, either generally or in a particular case, the accounts and records kept under this Division by an agent; and (b) to examine, either generally or in a particular case, the audit program, working papers and other documents used or prepared by an auditor in the course of auditing the trust accounts of an agent; and (c) to confer with an auditor in relation to audits of the trust accounts of an agent. (2) An examiner may, and must if required by the Commissioner to do so, provide the Commissioner with a confidential report as to the state of any accounts or records subject to examination by the examiner. (3) The Commissioner must, as soon as practicable, cause a copy of a report provided by an examiner to be given or sent by post to the agent. (4) In this section— agent includes a former agent. 24—Obtaining information for purposes of audit or examination (1) An auditor employed by an agent to make an audit of the trust accounts of the agent, or an examiner appointed under this Division, may require the agent or any other person in a position to do so— (a) to produce all the accounts (including accounts that are not trust accounts) relating to the business of the agent and all documents and records relating to those accounts, including written records that reproduce in a readily understandable form information kept by computer, microfilm or other process; and (b) to provide any relevant information relating to the operation of the accounts. (2) The manager or other principal officer of an ADI or other financial institution with which an agent has deposited money, whether in his or her own account or in a general or separate trust account, must, on being required to do so by an auditor or examiner employed or appointed to make an audit or examination under this Division, disclose every such account (including all deposit slips, cancelled cheques and other documents relating to the operation of the account) to the auditor or examiner. (3) A person who is required by this section to produce documents to an auditor or examiner must permit the auditor or examiner to make a copy of the whole, or any part, of those documents. (4) In this section— account includes a record required to be kept under this Division in relation to the receipt and disposition of trust money; agent includes a former agent. 25—ADIs etc to report deficiencies in trust accounts An ADI with which a trust account has been established must, as soon as practicable, and in any event within 14 days, after becoming aware of a deficiency in that account, report the deficiency to the Commissioner. 26—Confidentiality (1) An administrator, temporary manager, auditor or examiner must not divulge information that has come to his or her knowledge in the course of performing functions under this Act or a corresponding previous enactment except— (a) to the agent; or (b) to the Commissioner; or (c) as otherwise required by law. (2) A person engaged in the administration of this Act, must not divulge information disclosed in a report provided under this Part or a corresponding previous enactment except— (a) for the purpose of confidential consideration of the report by the Minister or the Commissioner; or (b) as is otherwise necessary for the proper administration of this Act; or (c) as is otherwise permitted or required by law. 27—ADIs etc not affected by notice of trust (1) Subject to subsection (2), an ADI is not affected by notice of a specific trust to which money deposited in a trust account is subject, and is not bound to satisfy itself of the due application of that money. (2) This section does not relieve an ADI of liability for negligence. 28—Failing to comply with requirement of administrators etc A person must not— (a) refuse or fail to comply with a requirement of an administrator, temporary manager, auditor or examiner under this Division; or (b) hinder, delay or obstruct an administrator, temporary manager, auditor or examiner in the performance of functions under this Division by altering or destroying relevant documents or by any other means.