What Singapore property agencies may not do with clients' money

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Kooky

Builder of Shaka, the payment router that pays every agent their commission on closing date.

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A property agency in Singapore earns a commission for bringing two parties together. It is not a bank, a stakeholder or a lender, and the law is written to keep it that way. An agency that takes a deposit into its own account, sends a hard-pressed seller to a moneylender, or lets a salesperson collect a quiet fee from a third party steps outside what the Estate Agents Act 2010 and its regulations allow.

This guide sets out those limits as the Council for Estate Agencies (CEA) publishes them: the rule against holding transaction money, the separation of estate agency from moneylending, the conditions attached to referral fees, the duty to declare an interest, and the records an agency has to keep for five years. It then shows which of these are criminal offences, which are disciplinary matters, and what published cases say about how they are applied. Licensing, commission and the complaint process are covered in other guides and appear here only where the rules meet.

Estate Agents (Estate Agency Work) Regulations 2010, regulations 6 and 7 and Second Schedule, version in force from 1 January 2026, as published by CEA.

Where the rules sit: one Act, two regulations, two codes

Three layers matter, all published on CEA's legislation page. The first is the Estate Agents Act 2010, which defines an estate agent as a person who does estate agency work and a salesperson as an individual who does that work while employed or engaged by an estate agent, or as its director or partner. In everyday speech the estate agent is the agency and the salesperson is the property agent; this guide uses the words of the Act.

The second layer is the Estate Agents (Estate Agency Work) Regulations 2010, which came into operation on 15 November 2010. CEA's legislation page gives the current version as the one in force from 1 January 2026. Three of its regulations create criminal offences that bear on money and side business: regulation 5 on dual representation, regulation 6 headed "No referrals to moneylenders", and regulation 7 headed "No holding of transaction monies".

The third layer is the pair of codes attached to those Regulations as schedules. Under regulation 3, every licensed estate agent and every registered salesperson must comply with the Code of Ethics and Professional Client Care, which is the First Schedule and runs to 15 paragraphs. Under regulation 4, every licensed estate agent must comply with the Code of Practice for Estate Agents, the Second Schedule, which has seven paragraphs. Regulation 4 does not name salespersons: the Code of Practice is addressed to the agency.

The difference between the layers decides what happens after a breach. Regulations 5, 6 and 7 each state a fine and a prison term, so a breach is an offence dealt with in court. The codes carry no fine of their own. The Code of Ethics says a failure to observe it may amount to unsatisfactory professional conduct or misconduct, and may lead to action before a Disciplinary Committee with sanctions such as financial penalties, demerit points, suspension or revocation.

Regulation 7: the money an agency may not hold

Regulation 7(1) states the rule in one sentence. No estate agent or salesperson shall hold or handle any money for or on behalf of any party in relation to two kinds of transaction: the sale or purchase of any property situated in Singapore, and the lease of HDB property.

Each phrase carries weight. "Estate agent or salesperson" means the prohibition binds the agency as well as the individual, so paying a deposit into the agency's company account is no more permitted than paying it to the salesperson. "Hold or handle" covers passing money on as well as keeping it. "Any party" takes in the agency's own client and the person on the other side of the deal.

The first limb is broad. It refers to any property in Singapore and is not confined to homes, so a sale of a shop or an office falls under it as a flat does. The second limb is narrow. It covers the lease of HDB property, which the Regulations define as property sold or leased by the Housing and Development Board under the Housing and Development Act, and a "lease" includes an agreement for a lease.

The Regulations do not define "transaction monies"; the phrase appears in the heading of regulation 7 and in the record-keeping paragraph of the Code of Practice. The working description comes from CEA's own guidance, discussed below.

The penalty is in regulation 7(3). A person who contravenes the rule commits an offence and faces a fine of up to S$10,000, imprisonment of up to six months, or both. Where the offence continues after conviction, a further fine of up to S$500 applies for each day or part of a day.

The two exceptions, and what falls outside the ban

Regulation 7(2) allows two things.

The first is delivery. An estate agent or salesperson may deliver a crossed account payee cheque or a cashier's order that is drawn in favour of another party to the transaction. A cheque made out to the salesperson, or cash, is not within this exception.

The second concerns property work. An estate agent or salesperson may receive remuneration or reimbursement for the management, repair or renovation of the property, as allowed under a written contract or authorisation. The text read for this guide does not say whose contract or authorisation it must be. What it does require is that the arrangement be in writing.

Beside those two exceptions stands CEA's explanation of what is not transaction money in the first place. In an article stated to be accurate as at 16 December 2025, CEA says valuation fees and agent commissions are generally not considered transaction monies. The same article adds that commission is paid to the estate agency, that is the company, and not to or through the individual agent.

CEA also describes a situation in which a salesperson pays first and is repaid afterwards. Its example is stamp duty on a lease: the salesperson may pay the duty and then seek reimbursement, but must not collect the amount from the client before stamping. The order matters, since money collected in advance would be money held for a party.

CEA's article says there are limited exceptions to the general prohibition and sets out the permitted and prohibited monies in tables. Those tables are published as images and could not be read for this guide, so the full list is not reproduced here.

How a payment is meant to travel

The practical effect of regulation 7 is that money moves between the parties, or to those the transaction documents name, without stopping at the agency. CEA puts it in consumer terms: pay the payee directly and not through the salesperson. For an HDB rental, its example is that the tenant pays the HDB flat owner directly.

CEA asks for payments to be made by verifiable means and names bank transfers, PayNow and crossed cheques. It warns against paying cash to the agent or transferring money to the agent's bank account.

For an agency, this turns into a matter of supervision. The Code of Practice requires an estate agent to keep written systems for managing its business and its salespersons, and to supervise salespersons so that they comply with the law and do not repeat conduct that led to an earlier breach.

What a regulation 7 conviction looked like

CEA publishes cases without leaving the reader to guess at the consequences. In a note dated 23 March 2023 it reported that, from December 2021 to January 2023, six salespersons were convicted by the State Courts for unlawfully holding transaction monies in a sale or purchase, or in the lease of HDB property.

One of those cases is described in detail. A salesperson handling the rental of an HDB flat let at S$1,800 a month asked the tenant to pay rent into a bank account that was the salesperson's own. CEA brought six charges under regulation 7(1)(b), punishable under regulation 7(3), for handling transaction monies between August and December 2021. The salesperson pleaded guilty to two charges, and the other four were taken into consideration. The court imposed a fine of S$7,250 on each of the two charges, S$14,500 in total. Full restitution had been made in February 2022.

A worked example puts the fine in proportion. Regulation 7(3) caps the fine at S$10,000 per charge, so two charges carry a ceiling of S$20,000. The S$14,500 imposed is 72.5 per cent of that ceiling. The rent involved was S$1,800 a month, so the total fine equals a little over eight months of that rent (S$14,500 divided by S$1,800 is 8.06). These are calculations from CEA's published figures, not a statement of how a court would decide another case.

The case also shows that repayment does not undo the offence. The money was restored in full, and the conviction followed all the same. Regulation 7 is breached by holding or handling the money, whatever happens to it afterwards.

Moneylending: a bar on the licence and a ban on referrals

The separation of estate agency from moneylending is built in two places.

The first is eligibility under the Estate Agents Act 2010. The Act defines a "moneylender's licence" by reference to the Moneylenders Act 2008. Under section 30(d), an individual may not hold an estate agent's licence while holding a moneylender's licence, or while being an employee, director or partner of someone who holds one. Section 31 applies the same idea to a company or partnership: it is barred if it holds a moneylender's licence, if any of its directors or partners holds one, or if any director or partner is an employee, director or partner of a holder. Section 32 bars an individual from being or remaining a registered salesperson on the same grounds, and section 38 bars the same persons from being appointed or continuing as key executive officer.

The words "or remaining" and "or continuing" mean the bar is not only a test at the door. Under sections 54 and 55 the Council may suspend or revoke a licence or registration where the holder is no longer eligible, after giving notice and a 21-day period for representations. The Act uses "may": the power is a discretion, not an automatic cancellation. The Estate Agents (Licensing and Registration) Regulations 2010, in the version in force from 1 October 2025, add nothing on moneylending; the bar is in the Act itself.

The second place is regulation 6 of the Estate Agency Work Regulations, which deals with conduct. No estate agent or salesperson shall introduce, refer or recommend a client to any moneylender, or otherwise suggest the use of a moneylender's services. Nor may an estate agent or salesperson receive any commission, reward, fee, payment or other benefit from a moneylender for any moneylending transaction. The regulation says "any moneylender" and does not limit itself to licensed ones. The penalty under regulation 6(2) is a fine of up to S$25,000, imprisonment of up to 12 months, or both.

Regulation 6 has two limbs that work independently. The referral is an offence even if nothing is paid for it. The benefit is an offence even if the borrower found the moneylender unaided.

CEA explained the purpose when it brought its first prosecution of this kind, with charges read in court on 21 December 2012. The release described six charges against a registered salesperson alleged to have referred clients who were selling HDB flats to a licensed moneylender between November 2010 and November 2011. Four clients were said to have been introduced; two borrowed S$5,000 each and one S$7,000, and the salesperson allegedly received two payments of S$150. CEA said HDB flats are meant for owner occupation and retirement needs and cannot be used as security for debt, and that the Estate Agents Act keeps estate agency separate from moneylending. The release was issued when the charges were read; the outcome was not in the document read for this guide.

Referral fees and other third-party payments

Moneylenders are the one kind of provider to whom a referral is banned outright. For other third-party services, the Code of Ethics sets conditions instead.

Paragraph 13(2)(e) says that, subject to written law, an estate agent or salesperson must not accept any fee, reward, commission, rebate or other payment for referring third-party services to the client, or to another party in a transaction involving the client, unless the client has express knowledge of it and has given prior written consent. Paragraph 13(3) adds that the fact of the payment and its amount must be disclosed in advance and in writing.

A fee taken first and mentioned later does not meet these conditions, because both the consent and the disclosure must come beforehand. The opening words, "subject to written law", mean the paragraph cannot be used to permit what another law forbids. A payment from a moneylender stays an offence under regulation 6 however fully it is disclosed.

Two neighbouring paragraphs complete the picture. Paragraph 7(4) says an estate agent or salesperson must not solicit a fee, commission or reward from a person who has not engaged their services. Paragraph 14 requires them to advise and encourage parties to seek appropriate professionals, such as solicitors, tax advisers, appraisers and valuers, on matters beyond their own knowledge. The Code thus expects referrals to happen; what it regulates is the money attached to them.

The paragraph on referral fees is part of the Code and not a regulation with its own penalty. A breach is a disciplinary matter, not a criminal charge.

Acting with an undisclosed interest

Paragraph 13 of the Code of Ethics is headed "Duty to avoid conflict of interests", and it starts from refusal. Under paragraph 13(1), an estate agent or salesperson must not accept or continue an appointment where their interests conflict, or could conflict, with the client's.

The rest of the paragraph explains how that works in practice.

Two specific situations are named. Under paragraph 13(2)(d), an estate agent or salesperson must not acquire the client's property, or any interest in it, directly or indirectly, without the client's express knowledge and consent. "Indirectly" extends the rule beyond a purchase in the agent's own name. Under paragraph 13(4), they must not engage in any work or activity that could compromise their duties to clients, which is the Code's general answer to side businesses beyond moneylending.

A Disciplinary Committee case summary published by CEA shows how small the undisclosed interest can be. A salesperson held an exclusive mandate to sell an HDB flat, which sold for S$520,000. A downline salesperson was to receive commission of 1 per cent of the price, payable by the buyers. The first salesperson stood to receive an overrider fee of 6 per cent of that commission and did not tell the sellers.

As a worked example from those figures: 1 per cent of S$520,000 is S$5,200, and 6 per cent of S$5,200 is S$312. The summary itself does not state the sum; the calculation is given here to show the scale.

The Committee found the conflict charge proven under paragraph 13(1) read with paragraph 13(2)(a), and said the salesperson had not discharged the burden of showing due disclosure. It also found proven a charge under paragraph 6 over marketing the flat on a "Buyer only" basis, and a charge under paragraph 12 over advertisements carrying the wrong block number. The sanctions were S$4,000 and six months' suspension on each of the first two charges and S$2,000 and three months on the third. The suspensions ran together, giving six months in effect, with S$10,000 in financial penalties and S$1,000 in fixed costs. The summary read for this guide carries no decision date.

The Code does not ask whether an interest is large. It asks whether the client was told in writing before the work went on.

What the agency must keep, and for how long

Record-keeping falls on the estate agent, under paragraph 7 of the Code of Practice. Originals or copies must be kept for at least five years.

Two entries tie this list to the rules above. Documents showing the receipt and payment of transaction monies must be retained even though the agency does not hold that money, so the file shows where each payment went. And written conflict declarations are a named category. In the case just described, the Committee placed the burden of showing disclosure on the salesperson; a declaration on file is the document that answers that question.

Copies may be kept electronically, and the paragraph does not displace retention periods set by other laws. The related written-form rules sit in the Code of Ethics: agreements on financial obligations are recorded in writing with their exact terms, and nobody is asked to sign an agreement with essential terms such as the price, the dates or the commission left blank.

The Code of Practice also requires a written system for claims and complaints against the agency or its salespersons. Every one must be investigated, within two weeks or a longer period the Council allows, and the complainant told the outcome promptly. On the Council's request, the agency reports on the investigation within the same period. The Act gives CEA's inspectors power to enter premises and to inspect and copy records.

Offence or disciplinary breach: who decides the penalty

The same set of facts can lead down different roads, and the ceilings differ sharply.

Under section 49 of the Act, the Council gives written notice before acting, and the person has 14 days to show cause; the Council may refer the matter to a Disciplinary Committee instead. Under section 52, a Committee may suspend or revoke a licence or registration with or without a financial penalty, and may order costs of S$1,000 or a prescribed amount.

The table shows something that is easy to miss. The criminal fine for holding transaction money is capped at S$10,000 per charge, while a Disciplinary Committee may impose up to ten times that on a salesperson and twenty times on an estate agent. And an estate agent answers for its own compliance with the Code of Practice, including supervision and records, whatever becomes of the individual salesperson.

CEA's enforcement statistics, last updated on 14 July 2026, show how often each route is used. In 2024 it served 268 letters of advice or warnings, issued 38 letters of censure, recorded 17 Disciplinary Committee actions and brought 8 court prosecutions, 331 actions in all. The 2023 figures were 267, 36, 17 and 8, a total of 328. Prosecutions were therefore 8 of 331 actions in 2024, about 2.4 per cent. CEA does not publish a breakdown by type of breach, so the number of cases about transaction money, moneylenders or conflicts in those years is not known from that page.

Open points in the published material

Several questions are not settled by the documents read for this guide, and each depends on the case. The Regulations leave "transaction monies" and "moneylender" undefined, and the property-work exception in regulation 7(2)(b) does not say who must give the written contract or authorisation.

Leases of private residential property are outside regulation 7 as drafted. CEA's advice to pay the payee directly is general guidance to consumers; the documents read here do not state what sanction, if any, follows where a salesperson handles rent on a private lease.

Kooky, from Shaka

Kooky edits Agents Estate and builds Shaka, the payment router he made for real estate professionals. One payment comes in, and every agent, agency and party in the deal receives their signed share on closing date.

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