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Letting agents accused of ‘ripping off’ landlords and tenants

We all know headlines sell newspapers, but a report in yesterday’s Daily Mirror brought shame on a host of letting agents across the country that have either been accused or convicted of 'ripping off' landlords and tenants, acting as a timely reminder that landlords must conduct careful due diligence and considerable thought when deciding on which letting agents to instruct when renting out property.

Daily Mirror investigative columnist Andrew Penman accused the government and councils of failing landlords and tenants by not enforcing their own rules.

He highlighted ‘greedy’ letting agent Nicholas Dowse of Harmsworth Estate Agents in Portsmouth who pocketed almost £30,000 in rent, deposits and service charges and spent the money on trips abroad, as well as Amy Williams and boyfriend Glen Austin of a Birmingham letting agency who were convicted for stealing deposits and rent paid in advance by tenants.

Darren Briggs of Cambridge based Morgan Fox (Lettings) Limited and Anthony Morgan UK Limited also didn’t escape unscathed after “repeatedly failing” to protect tenancy deposits to keep his business afloat.

One of many online complaints posted by a landlord read: “Not only has Darren Briggs not registered my tenant’s deposit with the Tenancy Deposit Scheme, he was of course also charging me a sum of money to be in the scheme.”

In Luton, Beds, letting agency Cash Property Management Ltd failed to protect the deposits of 45 tenants housed in an illegally-converted commercial building, while Glyn Robinson, of Harbour Properties and Services Ltd in Wakefield, was banned from being a director for seven years last month after failing to protect 139 tenant deposits of nearly £54,000.

In Glasgow, Shaban Rehman , of Better Homes Glasgow, lied to a family which had put down a deposit on a flat when he told them that it had been flooded and had become uninhabitable in order to keep the deposit. He also ripped off another tenant’s deposit.

Letting agents are supposed to belong to a government-approved redress scheme, with a civil penalty of up to £5,000 for failure to comply.

But the Mirror report that just 16% of councils have issued penalties against rogue agents and just 46% sent warning letters to known offenders, according to licensing body the National Approved Letting Scheme.

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    So regulate the lot of us - that's the simple solution. Compulsory CMP and external audits. Don't see what the issue is, other than the fact that it would open such a big can of worms.

  • Andrew McCausland

    I don't agree with the concept of more regulation as it drives up prices within the sector. All Councils need do is enforce the current legislation. In my area we have recently seen a surge in prosecutions of landlords and managing agents, with an emphasis on matters affecting tenant safety. Having spoken to the enforcement team just yesterday we expect them to now target the issues raised above. From their perspective it makes sense; not only are they looking after tenants' interests and enforcing the law, they now see that it can raise considerable income from fines (£10,330 from 1 case last week alone).

    I am not so cynical as to suggest money is their only driver, but the extra income does a lot more than cover their costs.

    Personally, I think it long overdue. There have been too many rogues in this industry for too long. Robust enforcement of the current regulations is sufficient to drive the dodgy ones out of business.

  • Don Holmes

    Self regulation simply does not work. I have been in the industry for 30 years and seen many different initiatives come and go, Accreditation for example is still being wrestled with, after probably 15 years of trying and still very few have achieved it or opted in, in comparison to numbers. I like many don't approve of more un-necessary regulations, but clearly by the introduction of licensing across the profession, based on standard criteria, such as 1) Fit and proper person test as in Scotland 2) A professional qualification, 3) Financial sound, 4) membership of appropriate professional bodies, such as CMP, DPS, and redress scheme. This would then alleviate many other bits of regulations no longer needed. Simple also to implement, A) a time scale for all current practitioners to comply and most would not need more than a few weeks, but lets say 3 months, after which suspension or closure. and B) All new applicants must comply before a licence issued. Professional practitioners need not be concerned of this and in fact would applaud it and those that are concerned would follow another career path.

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