A 49-year-old woman who was found naked with a man inside an illegal Ballarat brothel has avoided a criminal record.
The woman, who is not a Ballarat resident, was placed on the diversion program after pleading guilty to a single count of knowingly living from the earnings of prostitution.
The Ballarat Magistrates' Court on Friday heard police initiated a search warrant under the Sex Work Act on September 22 at the suspected illegal brothel at 901 Skipton Street in Redan.
Police found the woman naked in one of the rooms of the house, with a male pulling up his underwear as he lay on a bed.
The elderly male told police he attended the house, rang the doorbell and paid $60 with the expectation he would get a massage with a "happy ending".
Police arrested the woman who made no admissions, telling them she only made $200 cash from massaging over the five-days she had worked there.
Asked why she was naked, she told police she "wanted to get more comfortable".
The Skipton Street premises, which was operating as "Silk Hands Massage" was declared a prescribed brothel by the Ballarat Magistrates' Court on October 4.
The accused's lawyer, Jarred Hofman, told the court there was a misunderstanding on his client's behalf about what was to occur.
Mr Hofman said his client had not performed any sexual acts on that day, or on any other occasion in the five days she worked at the Redan premises.
He added the woman had been an Australian resident for two years, was married with no criminal priors and now lived 2.5 hours away from Ballarat.
Magistrate Gregory Robinson told the woman, who was assisted in court by a Chinese interpreter, an important aspect of the heavy regulation of the sex industry in Australia was for health and safety reasons.
"If you do plan to work in that industry (illegally) you can expect to be dealt with by criminal sanction," he said.
As part of the diversion program - which aims to give first-time offenders an opportunity to avoid a criminal record by undertaking conditions that benefit the offender and the community - the woman will need to be of good behaviour for the next six months.
She will also need to contribute $350 to the court charity fund.