Real estate manager steals $160,000 from trust to fund gambling addiction – how to stop it happening to you

Businesses have been warned to look out for signs of gambling addiction in the workplace after a young Victorian real estate manager who stole $160,000 in trust money narrowly avoided prison.

Nadim Mindraoui, 20, was working with his father for City Residential Real Estate when he took money from the agency’s trust account between December 2010 and April 2012 to fund his gambling habit.

The incident is not uncommon – fraud is a growing problem among Australian businesses, and more employees become tempted as they gain more responsibility and access.

Mindraoui was only 18 when the fraudulent behaviour began and had no prior convictions. The money stolen has since been repaid.

He was sentenced to a 15-month community corrections order and must perform 60 hours of community service, undergo a mental health assessment and treatment, and take part in an offending behaviour program.

The magistrate said he would have received a prison sentence, had it not been for his guilty plea.

Fraud expert Brett Warfield of Warfield and Associates told SmartCompany gambling is the most common motivator for fraudulent behaviour.

“He’s got the gambling bug very early. They tend to use their own money, but when they don’t have any more they steal it from their employer or clients.”

“Taking money out of a trust isn’t that hard to do. The fact that he’s young has certainly gone in his favour, as the judge doesn’t want to ruin his life, but he’s lucky he had someone to repay it,” he says.

Warfield says there have been many cases in the past few years of fraud occurring in real estate agencies.

“It comes down to a lot of trust being placed in individuals. The money goes into the trust for people who are selling houses or have rental properties with the real estate agent.

“Because real estate agents don’t tend of have internal audits, as they are largely too small, there is a lot of trust involved and it’s based on the integrity of the individuals,” he says.

In previous cases of gambling motivated fraud, amounts stolen have ranged up into the millions.

Earlier this year, a woman was jailed for eight years after stealing almost $8 million of her employer’s money to spend on gambling, first class trips and a corporate box at Etihad Stadium.

Accountancy business William Buck has had more cases of employee fraud reported recently than “ever before”.

Head of the firm’s audit focus group, Leo Tutt, said in a statement many SMEs are overlooking basic control procedures.

“Generally, there’s always some sort of control flaw or failing that enables fraud to take place.

“Employers need to focus on having processes in place to prevent fraud from occurring rather than trying to deal with it after the fact,” he says.

He says such measures include enforcing annual leave, ensuring clear reporting channels and having internal controls in place such as third-party checks for transactions.

Warfield says these cases are all too common and warns businesses to look out for behaviour such as the person changing their workplace behaviour, purchasing expensive cars or luxury holidays and retrenched workers volunteering to work for free.

“When it comes to smaller businesses like real estate agents, it’s really a matter of vigilance and noticing any unusual behaviour when it comes to gambling,” he says.

*This article was updated on November 22, 2016, to correct the amount of money taken from the trust account. 


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