I found this thread on a message board about TotalNIC.
http://www.sitepoint.com/forums/showthread.php?t=135235
They've been doing this for several years, it seems.
Apparently the Australian Competition and Consumer Commission were investigating but I can't find the results of that.
ICANN have received plenty of complaints about TotalNIC and have produced this policy aimed at making it easy to transfer domains.
http://www.icann.org/transfers/
I don't know when they will enforce it.