The Competition and Markets Authority (CMA) has fined three estate agents over £600,000 for illegally fixing minimum commission rates sold to customers.
The CMA found that the companies, Michael Hardy, Prospect, Richard Worth and Romans, broke competition law by taking part in a price-fixing cartel, which began in September 2008.
For almost seven years, the four companies 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 local home-owners 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.
Michael Hardy has been fined £143,843, including the 10% reduction for settlement, Prospect has been fined £268,765 which also includes a 50% reduction under the CMA’s Leniency Programme and 10% reduction for settlement and Richard Worth has been asked to pay £193,911.
Romans will not be fined as it brought the illegal activity to the CMA’s attention 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 industry needs to take note: this kind of behaviour will not be tolerated. If you break the law, you risk similar consequences.”
The total fines imposed take into account the behaviour of the companies involved. Michael Hardy’s and Prospect’s fines have been discounted to reflect the fact they admitted to illegal behaviour and agreed to cooperate with the CMA, thereby shortening the length of its investigation.