While you may be correct in that assumption, hypen, I think you are looking at this the wrong way.
Freo members (seat renters) pay a very steep price for their membership. Freo even charge more than the slime for the same seats in some categories. The club itself doesn't treat the members as members of a club. They treat them as customers.
The basis of any reasonable business transaction is 'value given for value received'. In this case there is likely to be no value received, so it's not really a valid commercial transaction.
To my way of thinking, had the club acted as a club and not a commercial enterprise, they'd be in a position to appeal to the members not to reclaim their money. Hanging on to the money when they are not delivering any value for it because it helps their business to survive isn't justified.
The only thing they can do to act properly is to offer to return the money and give full details on how to apply for it or give the seat renters an opportunity to get the money or donate it to the club. That needs to be an informed choice, not a fait accompli or a donation by stealth.
Anything less than a properly informed choice on the part of each seat renter is improper and making it difficult for people to know how to make that informed choice is probably fraudulent.
It's also massively hypocritical when up till now it's acted as a commercial organisation conducting commercial transactions but now when it loses it's steady income, it wants everybody to treat it like a club. It's pretty disgraceful conduct and shows the arrogance that has been a hallmark of Freo FC since the day of the Steves. You reap what you sow.