The recent conviction of letting agent Lee Grace for illegally keeping £45,000 of tenancy deposits has contributed significantly to the near £850,000 worth of deposits known to be stolen so far this year.
Grace, of Kings Hill letting agents in Kent, was sentenced last week to eight months in prison after being found guilty of keeping a number of client deposits, between 26 October 2014 and 8 February last year.
The guilty verdict has presented the head of Keep It Simple Group, Ajay Jagota, with yet another opportunity to campaign against rental deposits in the private rented sector.
Jagota, who keeps a running total of the cash value of deposits criminal letting agents have been convicted of stealing, reports that by the end of the third quarter of this year, thefts totalled £847,227 – an average theft of £44,591 per conviction.
At least 24 rogue letting agents and buy-to-let landlords have been convicted of offences relating to the theft of deposits so far this year - at an average of more than two a month.
Jagota ultimately believes that a more effective way to improve the private rented sector would be for monetary deposits to be scrapped.
His firm KIS were the first letting agents to abolish monetary deposits, replacing them with a one-of-a-kind insurance policy.
Jagota is also founder of dLighted, an insurance backed deposit-free renting solution offering cover for agents.
He said: “Not only do deposits drive up the cost of renting - hurting landlords as much as anyone by making it harder to find tenants while providing feeble protection against unpaid rent or property damage – they make criminal behaviour easy .
“They hurt letting agents too, leaving them vulnerable to the huge reputational damage of convictions like this or exposing them to potentially bankrupting losses and costs.
“As I’ve said time and time again, the very worst part of this is that these figures don’t even start to show the true scale of deposits being misused, misplaced. misappropriated or plainly and simply stolen.
“We’re currently investigating another case where tens of thousands of pounds of deposits appear to have vanished, and that’s before we consider the widespread but unacceptable practice of letting agents using deposit cash for day to day business expenses.
“Zero deposit means zero risk. Zero risk of mounting rent arrears because of our rent guarantee. Zero risk of deposits not covering the cost of property damage due to the £500,000 of cover our deposit replacement insurance offers. And zero risk of tenant’s cash being pocketed by rogue letting agents and landlords.”