Almost a year after state authorities urgently intervened in and then shut down Berkeley Living, where bedridden residents were left to fend for themselves in the wake of a staff walkout, Consumer Affairs Victoria has begun criminal proceedings against the man operating the retirement village.
In a media statement, Consumer Affairs Victoria alleged Stephen Snowden operated the retirement village in Patterson Lakes between July and September 2017 when he was not permitted to do so.
It said it was seeking a financial penalty against Mr Snowden. The case will be heard at the Frankston Magistrates Court.
Under section 17 of the Retirement Villages Act, the maximum penalty is 50 penalty units for one count, which amounts to $8059.50.
Fairfax Media wrote a series of stories last year about Berkeley and Mr Snowden, which included revelations by 30 families that apartments they owned had been sold, but they never received the sale proceeds. Residents are believed to be owed millions.
Mr Snowden, a former bankrupt and a convicted criminal, denied the allegations and referred to the residents as “scumbags”.
Jane Cartledge has spent a decade trying to claw back $270,000 she said she was still owed from the sale of her mother's apartment at Berkeley. She said the families had hit a wall.
She welcomed the news that Consumer Affairs Victoria was taking action against Mr Snowden but said she still didn't have her money.
“It is fantastic but I’m still getting nowhere. My parents would be churning if they knew what happened,” Ms Cartledge said.
In 2013, Mr Snowden’s aged care business, Cambridge Aged Care, was investigated by the Department of Health and the Victorian Coroner in relation to the poor care of residents.
Mr Snowden was described as a "serial scammer" after Westpac chased him in 2013 in the Supreme Court of Victoria for $13 million he allegedly misappropriated.
The court found in favour of Westpac and the bank appointed a liquidator to Berkeley Living. In 2014, the bank won a court order to bankrupt him. Snowden took over management of the village in 2009 when the previous operator ran into financial trouble and his business was wound up.
The Berkeley expose followed a joint Fairfax Media and Four Corners investigation into one of the biggest retirement village operators, Aveo, which found a litany of questionable business practices including complex and opaque contracts, fee gouging, safety issues and misleading marketing promises.
The investigation put the spotlight on weak regulations that fail to protect residents. It triggered a series of inquiries and to the industry developing a draft code, which has been slammed by various consumer movements as weak, ineffective and convoluted and “likely to result in complaint fatigue”.
In a joint submission lodged as part of the consultation over the draft code, the Consumer Action Law Centre (CALC), Residents of Retirement Villages Victoria (RRVV), Housing for the Aged Action Group (HAAG) and COTA Victoria said they “do not consider the draft code as a genuine attempt to improve industry standards or respond to the key concerns of residents”.
Governments need to step in to ensure residents and their families are treated fairly.Katherine Temple
It said key concerns included complex and unfair contracts, excessive fees and difficulty achieving binding resolution of disputes. It criticised code administration and enforcement as “weak” and a ploy to avoid legislative reform.
Katherine Temple, a senior policy officer at CALC, said the retirement housing industry wasn’t capable of self-regulation. “Governments need to step in to ensure residents and their families are treated fairly," she said.
"Residents shouldn't have to spend the best years of their retirement fighting big business in court to get justice. We need an ombudsman to provide free, fair and independent dispute resolution.”
The case continues.