On 15 November 2018, Rick Otton and We Buy Houses received the highest penalties ever imposed in Australia for breach of Australian Consumer Law.
The Federal Court imposed penalties totalling $18 million against We Buy Houses Pty Ltd (We Buy Houses) and sole director, Rick Otton, for making false or misleading representations about how people could create wealth through buying and selling real estate, following ACCC (regulator) action.
A $12 million penalty was imposed against We Buy Houses, and $6 million imposed against Otton personally. The penalty followed a Court hearing in August 2017 .
The Federal Court also banned Otton from managing corporations for 10 years in Australia and permanently restrained Otton and We Buy Houses from further involvement in the supply or promotion of services or advice concerning real property transactions or investment.
Despite Otton recently explaining that the matter was simply a misunderstanding about the title of his book, the Court found that Otton had made many misleading statements at his seminars, in marketing and in his book, including falsely claiming property deal example were true. The Court also found that Otton was a “very unreliable witness who was prepared to maintain or defend statements that were obviously untrue or misleading and who is habitually careless with the truth”, and that Otton ceased the property business, in part, due to poor financial performance.
See ACCC media release here.