Two bosses of an estate agency in Burnham-On-Sea have been disqualified for price-fixing.
David Baker and Julian Frost oversaw Abbott and Frost Estate Agents in College Street, pictured here.
The Competition and Markets Authority (CMA) discovered they were part of a cartel that secretly fixed their commission fees at 1.5% which meant that homeowners could not negotiate lower moving costs from February 2014 for just over a year.
Mr Baker will be unable to act as a company director for three and a half years, whilst Mr Frost has been disqualified for three years.
“As a result of its investigation, the CMA found that a number of directors were actively involved in the cartel or were aware of it and failed to take steps to stop it,” said a spokesman for the CMA.
“The CMA has secured legally binding undertakings from two of these directors – Mr Baker and Mr Frost – which have the effect of disqualifying them as directors and preventing them from being involved in the management of any UK company.”
“The CMA is continuing to investigate whether to seek the disqualification of other directors of companies involved in the fee-fixing agreement.”
“The CMA has the power to seek the disqualification of an individual from holding company directorships, under the Company Directors Disqualification Act 1986, where they have been director of a company which has breached competition law and their conduct makes them unfit to be a director.
Investigations continue into a number of other agencies involved in the cartel, which we previously reported here.
Michael Grenfell, executive director for enforcement at the CMA, said: “Agreeing prices with competitors is one of the most serious ways a company can break competition law, as it harms individuals, businesses and the economy.”
“When, as in this case, estate agents agreed among themselves commission fee rates, the effect is to stop people from shopping around for the best deal to help them with one of the biggest financial decisions any of us make – selling a house.”
“Company directors have an important responsibility to ensure that their companies don’t engage in illegal anti-competitive practices.”
“This news should send a clear message to directors that if their companies breach competition law they risk personal disqualification.”
In May 2017, the CMA issued a decision finding that 6 estate agents had infringed competition law. The CMA imposed fines totalling £370,084 on Abbott and Frost Estate Agents Limited, Gary Berryman Estate Agents Ltd (and its ultimate parent company Warne Investments Limited), Greenslade Taylor Hunt, Saxons PS Limited and West Coast Property Services (UK) Limited.
The sixth party, Annagram Estates Limited (trading as CJ Hole), was not fined as it was the first undertaking to confess its participation in the arrangement under the CMA’s leniency policy and co-operated with the CMA’s investigation.
Julian Frost previously told Burnham-On-Sea.com: “The episode regarding the CMA represents a dark day in our company history. First and foremost, we wish to apologise unreservedly to all those Abbott & Frost customers who may have been affected by this. In addition, we wish to express our apologies and regret to the people of Burnham, and also to the loyal staff who serve us and our customers well.”