Anonymous broker claims developers paying $10k 'unethical' kickbacks

by Adam Smith15 Apr 2015
An anonymous Melbourne broker has told a media outlet developers are enticing brokers with "unethical" referral fees.

A Sydney Morning Herald piece has claimed mortgage brokers are being paid $10,000 or more for passing leads to property developers. A broker from inner Melbourne, speaking to the news outlet on condition of anonymity, claimed he was offered $20,000 per referral by a developer.

The piece said the broker turned down the offer, regarding it as unethical. But the SMH piece has claimed that consumers should be wary of brokers talking up the investment potential of properties.

"Buying a property is a big transaction and being steered to a particular developer by someone who receives a kickback has to be treated with scepticism," the Herald said.

While the piece particularly targets brokers, the Herald warned that developers could pay "kickbacks" to any introducer, "be it mortgage brokers, SMSF advisers, financial advisers, accountants or real estate agents".

Have you been approached by developers offering referral fees? Are referral fees from developers fair game, or ethically questionable? Have your say in the comments below.


  • by Ethical broker 15/04/2015 8:43:07 AM

    Gee what a surprise, people being influenced by $$.
    People live under a rock if they don't think it happens

  • by Alex Stephen 15/04/2015 8:47:59 AM

    What makes the world go round?
    Why should a data base owner not benefit, provided they are not ripping off clients.
    You think major R/E firms don't get way more than $10k to market property to their investor database? What basis are they paid on?
    At the end of the day, a buyer has to do what's best for them. If their broker/banker/agent/hair dresser gets paid a referral fee on the way, what's wrong with that? How else would the opportunity have come to the buyer?

  • by Anon 15/04/2015 8:50:49 AM

    How is this any different to an accountant or real estate agent referring their clients to a broker for a referral fee? No one bats an eye at that and I've seen what unskilled brokers can cost a client. Like anything it depends on the quality of the outcome, if it's a quality developer and the broker is confident their client will get looked after I don't see the problem. It comes down to if the referrer has the clients best interest at heart. Be that an accountant referring to a broker or a broker referring to a property developer.