Fidelity guarantee account

The Fidelity Guarantee Account helps provide financial reimbursement to people who suffer pecuniary loss or loss of property through the criminal or fraudulent actions of a licensed real estate or business agent, real estate settlement or business settlement agent or their employees in the course of a real estate settlement or business broking transaction.

The account is financed through contributions from agents and sales representatives, interest on agents' trust accounts and interest generated by the account.  


How to make a claim

Before making a claim, please read the information provided below and view the  Fidelity Guarantee Account Information Bulletin No.1.

To make a claim for financial reimbursement from the Fidelity Account, you need to lodge a claim form

Persons eligible to make a claim on the Fidelity Account

Section 116 of the Real Estate and Business Agents Act 1978 and section 93 of the Settlement Agents Act 1981 require that, in order to be entitled to recover from the account, a claimant must satisfy ALL of the following criteria:

  • The claimant has suffered financial loss (which includes a diminished financial value of funds or property) or loss of property;
  • The loss was due to defalcation (which includes criminal or fraudulent conduct) by a licensed agent, or an employee of a licensed agent;
  • The defalcation was by either:
    • a licensee during any period when the licensee was the holder of a current triennial certificate, granted under the Real Estate and Business Agents Act 1978 or the Settlement Agents Act 1981; or
    • a person who ceased to hold a current license or triennial certificate, if:
      • the defalcation occurred within 6 months following the day the person ceased to be licensed or the holder of a triennial certificate; and 
      • the chief executive officer considers the circumstances of the claim to be reasonable.


  • The loss occurred in relation to a real estate or settlement transaction in the course of the licensed agent's business as an agent.

Claimants are only entitled to claim the actual amount of the loss after the deduction of any payments or benefits received in relation to the transaction. Consumer Protection may give consideration to the reimbursement of legal fees pertaining to the proceedings before Consumer Protection on a case-by-case basis.

Amounts not generally claimable under the Fidelity Account

In most instances, only costs with a direct relationship with the defalcation will be considered. The following types of losses are generally not claimable:

  • Legal fees with respect to action independent of Consumer Protection  - the cost of a District Court action is not money lost by reason of the fraudulent conduct, unless they are a result of an appeal from a decision made by Consumer Protection. There is no scope for Consumer Protection to pay  consequential loss of this nature from the account.
  • Employee commissions and entitlements - commission and entitlement claims are contract disputes between an employer and employee (not a real estate transaction) and are a matter for the Industrial Relations Commission.
  • Interest or other amounts in excess of the extent of the defalcation - Section 117(3) of the Real Estate and Business Agents Act 1978 and section 95 of the Settlement Agents Act 1981 state that no amount shall be charged or be chargeable to the account as interest on the amount of any judgment obtained of any claim admitted against the account. The amount of the claim must not exceed the actual loss suffered as a result of the defalcation.
  • Amounts claimed as a tax benefit - must be deducted from the amount of the account claim because they reduce the actual loss suffered by the claimant.
  • Additional reimbursements on settled claims - claimants may discover additional costs associated with a Fidelity Account claim.
  • Management fees - management fees are not generally claimable, however there may be circumstances where they will be considered (i.e. when a fee has been taken without written authorisation).
  • Trade Creditors - amounts owed to trade creditors are not real estate transactions and do not qualify for reimbursement under the Fidelity Account. If the debt relates to a specific property managed by an agent, the creditor should be encouraged to recover the debt from the landlord.

Limitation period for lodging a claim

Consumer Protection must receive written notice of a person's intention to make a claim against the Fidelity Account within three years after the day on which the applicant became aware of the defalcation. Consumer Protection may, in circumstances where it considers it just and reasonable to do so, allow a period of up to six years.

If a person wishes to lodge a claim after more than three years, the claimant must:

  • Provide an explanation, within 14 days, of why the claim is being lodged out of the allotted time.
  • Prove that it is just and reasonable for Consumer Protection to hear their claim outside three years.  

Other relevant legal proceedings in progress

The claimant must provide full disclosure of any other relevant legal proceedings in progress as the documents and evidence for these proceedings may be similar to the claim before Consumer Protection.

In such cases, the claim may be adjourned until those other proceedings are finalised.  

Providing evidence

It is the responsibility of the claimant to provide evidence that a defalcation occurred and that action was directly linked to their financial loss. Consumer Protection will assist the claimant to obtain evidence if necessary.

Has the defalcation been proven?

Before Consumer Protection can allow a claim against the Fidelity Account, it must be satisfied that a defalcation has occurred. The three most common ways for this to occur are:

  • an admission from an agent;
  • documents that show it has occurred (e.g. audit reports and supervisor reports); and
  • where the State Administration Tribunal has found a defalcation.  

Administrative approval of claims

Consumer Protection may settle a claim where the claim has been substantiated. A claim may be substantiated where:

  • the defalcation is proved;
  • the loss was caused by the defalcation; and 
  • there is an actual loss.

Administrative approval of claims is often possible in cases where a large number of claims result from a single defalcation. In these cases there will often be a supervisor or an administrator appointed who can help substantiate the defalcation. 

Payment of a claim

On payment of money from the Fidelity Account to the claimant, Consumer Protection shall, to the extent of that payment, have all rights and remedies of the claimant against the licensee, and may commence an action in the District Court to recover the money.


The Fidelity Guarantee Account is established under the Real Estate and Business Agents Act 1978 and the Settlement Agents Act 1981, and is administered by Consumer Protection.

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