I once dealt with a model agency that was run by a woman who never got to be a model herself yet thought she could make it in this business. Bottom line, she had no clue as to what she was doing and what the standard business practices are.
If the agency wants photos, fine. They can buy them or discount their fee for the model, but in any event put it in the contract. Under no circumstances would I let rough images go out, for the very reasons you gave.
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