Posts with tag: rogue agents

Tenancy deposit thefts over £700,000 already in 2017

Published On: July 27, 2017 at 8:48 am

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Interesting new data has revealed that rogue letting agents were convicted of stealing nearly £700,000 worth of tenancy deposits during the opening half of 2017.

The average total for each theft totalled nearly an eye-watering £50,000, according to renting reformer, Ajay Jagota.

Deposit Thefts

Mr Jagota keeps a running total of the overall cash value of deposits that rogue letting agents have been found guilty of stealing. Jagota publishes these figures on a quarterly basis.

At the end of June 2017, overall thefts for 2017 amounted to £673, 273, with an average theft of £48,091 per conviction.

Now, subsequent convictions have taken this overall total close to £750,000.

15 rogue agents have been convicted of offences surrounding the theft of deposits during 2017, at nearly two per month.

Research from deposit-free renting solution Dlighted last year indicates that £1,018,100 worth of deposits were stolen during 2016. Worryingly, 2017’s figures are set to break past this figure.

Stealing

Ajay Jagota, founder of Dlighted, said: ‘Some are arguing that no reform of the deposit system is necessary. But in the current system agents have managed thefts of at least £700,000 in just six months.’

‘Within the next four years, almost £6billion will be held in tenancy deposit schemes, roughly £4billon of which will retained by letting agents and landlords. Not only is this money missing from the UK economy, it is far too easy for it to go missing altogether.’[1]

Tenancy deposit thefts over £700,000 already in 2017

Tenancy deposit thefts over £700,000 already in 2017

Offering a solution, Mr Jagota noted: ‘It’s simple – if renting is deposit free, it isn’t possible for people to steal deposits. Not only does deposit replacement insurance better protect property investor’s assets and offer them compensation for legal fees and lost rent – as well as making it easier to find and keep good tenants – it also prevents crime.’

‘The worst part is the almost £2million which landlords and letting agents have been convicted of stealing, is in my opinion and many of those in the industry,  nowhere near the true scale of money misappropriated from tenancy deposit accounts with an alarming number of operators apparently happy to use money from tenancy accounts for other business purposes.

Much of this money will be put back, but much of it won’t – and the fact money is missing will only ever be uncovered in the event of company collapse or criminal investigation. The legislation the government will be bringing forward to cap deposits is also the ideal opportunity to do something about this scandalous situation,’ he concluded.[1]

[1] http://www.propertyreporter.co.uk/landlords/tenancy-deposit-thefts-now-top-700000.html

 

Letting agents: Take note of new civil penalties!

Published On: April 6, 2017 at 10:39 am

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New legislation that comes into play today is to give local authorities in England tougher new powers in order for them to clamp down on rogue agents and landlords.

For the first time, local housing authorities are able to impose a civil penalty of up to £30,000 for a range of housing offences.

Legislation

The offences that can fall subject to charges are:

  • Failure to comply with either a housing improvement or overcrowding notice
  • Failure to have the sufficient licence for a property that requires a mandatory HMO, additional or selective licence
  • Failure to comply with HMO management regulations

For properties that do not have the correct licence, or are found to be in breach of rules surrounding HMOs, both the landlord and letting agent can be held accountable. This means that compliance checks are now imperative.

Before any penalties are imposed, local authorities must adhere to Government guidance and issue a notice of intent.

Letting agents: Take note of new civil penalties!

Letting agents: Take note of new civil penalties!

Rent Repayment Orders

In addition, the Government is expanding its Rent Repayment Order provisions, in order to enable local authorities or tenants to claim back up to 12 months rent.

Beforehand, this was only available to licensable properties. However, tenants could not make a claim unless the local authority had prosecuted the landlord.

From today, Rent Repayment Orders are available as a sanction for more offences, which include:

  • illegal eviction or harassment
  • using violence in order to secure entry
  • failure to comply with a housing improvement notice

Tenants can now submit a claim without the local authority having prosecuted the landlord. Unlike criminal prosecutions, any income that is received from civil penalties or Rent Repayment Orders can be retained by the local authority and then spent on housing enforcements.

Vital

Isobel Thomson, chief executive of NALS, said: ‘Whilst we support local authority action to crack down on rogue landlords and agents, it is vital that councils resist the temptation to issue financial penalties for very minor infringements purely to raise income and fill their budget black hole.’[1]

‘If used wisely, these powers could mark an important step forward in driving rogue operators from the market and improving consumer protection. With councils able to retain revenue from targeted enforcement action, the business case for introducing new bureaucratic and costly licensing schemes is weaker than ever. It is time for councils to think again and adopt a smarter approach to regulation,’ she added.[1]

[1] https://www.lettingagenttoday.co.uk/breaking-news/2017/4/letting-agents-in-the-firing-line-as-new-civil-penalties-come-into-effec

MPs call for greater powers to crackdown on illegal London lets

Published On: March 22, 2017 at 10:37 am

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As more buy-to-let landlords in London are beginning to utilise short-term letting platforms such as Airbnb, MPs are calling for more powers in order to crackdown on rogues.

A growing number of landlords are using these platforms to breach rules on letting properties, which only permit homes to be rented out short-term for up to 90 days.

Crackdown

Talking to Parliament yesterday, Westminster North Labour MP Karen Buck, along with nine other MPs, argued that landlords should have to notify councils of the dates that their property is being used for short-letting.

Buck notes that Westminster council alone is investigating over 1,100 properties which are believed to have breached the 90-day limit.

She said she welcomed, ‘freedom for homeowners to let their properties,’ but insisted that, ‘without excessive bureaucratic interference,’ it is hard for, ‘cash strapped councils to police the rules.’[1]

‘Alongside the responsible owner-occupiers are irresponsible ones, illegal sub-letters and an increasingly significant commercial operation, seeking to take advantage of potentially higher yields,’ she continued.[1]

MPs call for greater powers to crackdown on illegal London lets

MPs call for greater powers to crackdown on illegal London lets

Blocks

Earlier in March, the Mayor of London called on short-term agents operating in London to block hosts from renting out homes in the capital for over 90 days. These include Veeve, One Fine Stay, Wimdu, Booking.com, HomeAway and Airsorted.

However, until there is a change in the existing rules to analyze activity levels, Field thinks that a, ‘free-for all in short-term lets’ will keep, ‘causing misery for thousands of our constituents.’[1]

‘We want the local council to have effective powers to clamp down on this,’ she concluded.[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2017/3/mps-call-for-greater-powers-to-clamp-down-on-illegal-lets-in-london

New toolkit targets rogue agents

Published On: June 28, 2016 at 10:39 am

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The National Approved Letting Scheme has moved to create a toolkit which is designed to assist local authorities in tackling rogue agents.

This scheme claims that cuts to public spending have left some local authorities without the knowledge and skillset to efficiently regulate the private rented sector.

Scheming

In a press release, the National Approved Letting Scheme claim that only 16% of local authorities have moved to issue penalties for failure to comply with redress scheme membership.

It must be noted however that this figure involved results from only 37 councils from research conducted between August and September 2015.

The toolkit proposed by the National Approved Letting Scheme includes:

  • warning letters to agents who fail to comply with legal duties.
  • advice on serving civil penalties
  • requirements on belonging to a redress scheme
  • the need for agents to display fees
  • client money protection advice
  • powers of councils
New toolkit targets rogue agents

New toolkit targets rogue agents

Raising standards

Isobel Thomson, chief executive of the National Approved Letting Scheme, said, ‘only by raising standards across the sector can we start to tackle the small minority whose rogue activities tarnish our reputation. This toolkit is designed to be a ‘one stop shop’ for local authorities working with the private rented sector. They are, after all, in the enforcement front line.’[1]

[1] https://www.lettingagenttoday.co.uk/breaking-news/2016/6/rogue-letting-agents-being-targeted-by-new-toolkit-for-councils

 

 

RLA issues warning to Gumtree over letting scams

Published On: February 19, 2016 at 2:27 pm

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The Residential Landlords’ Association (RLA) has called on a leading classified online listings service to issue clear guidance over possible scams involving bogus letting scams.

A warning was issued to Gumtree by the RLA after fraudsters posed online as landlords to post ads on the site asking for money in exchange for property viewings.

Scams

In certain cases, the advertisements posted online show affordable and attractive dwellings. However, when potential tenants attempt to arrange a viewing, they are told that the landlords lives a long way away and that they must provide a deposit in order to secure a viewing. Sometimes, these fees cost £1,500!

The criminals behind these scams have cloned websites’ logos, including that of the RLA’s Deposit Guard Scheme. As such, the schemes look genuine to would-be tenants.

Once tenants pay cash for their fake viewing, they never hear from the fraudsters again and their money is lost.

RLA issues warning to Gumtree over letting scams

RLA issues warning to Gumtree over letting scams

Demands

To stop more innocent renters becoming victims, the RLA has now contacted Gumtree demanding visible warnings on its website.

‘Often, the victims in this type of fraud are young foreign students, who have limited knowledge of how the rental market works in the UK,’ said a spokesperson for the RLA. ‘The fact that our DepositGuard logo is being used in this manner is something we are taking extremely seriously and we have approached Gumtree asking for clear warnings about scams of this type to be included on its website,’ they added.[1]

Any victims of this kind of fraud are being advised to call Action Fraud on 0300 123 2040.

[1] https://www.lettingagenttoday.co.uk/breaking-news/2016/2/industry-group-asks-gumtree-to-issue-public-warning-about-letting-scams

Cambridge letting agent prosecuted for unlawful eviction

Published On: February 16, 2016 at 10:13 am

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A letting agent who unlawfully evicted one of his tenants from a property has been ordered to pay a substantial fine by Cambridge Magistrates Court.

Alan Croft, director of BestLet Property Management and Lettings, pleaded guilty to unlawfully removing the resident of the premises under Section 1(2) of the Protection from Eviction Act 1977.

Mr Croft was told to pay a total of £4,315 as a result of his negligence.

Case for concern

The case revolved around a tenant who rented a room in shared accommodation which was managed by BestLet. The tenant contacted the council for assistance after the agent from BestLet entered his rooms without giving him the requisite 24 hrs notice.

Council officers contacted BestLet and told the agency of the legal procedure that must be followed to access rooms. The correct process of evicting a tenant was also provided.

Despite this, Croft nor his agency served the necessary legal notice to gain possession, nor was an application given to the court for an eviction order. What actually happened was that Croft gave instructions to an employee to change the locks on the property. In addition, Croft instructed the employee to put the tenant’s possessions into bin bags in the front garden!

The court also heard that BestLet had not protected the tenants’ deposit, another breach of law. This deposit had also not been returned.

Cambridge letting agent prosecuted for unlawful eviction

Cambridge letting agent prosecuted for unlawful eviction

Prosecution

Mr Croft and BestLet were prosecuted and fined a total of £1,370, told to pay council’s costs of £2,408 and a victim surcharge of £137. Additionally, the tenant was given £400 in compensation for their hardship and damage to their possessions.

Kevin Price, executive councillor for housing at Cambridge City Council, noted, ‘council officers work with tenants, landlords and agents to ensure that the correct legal processes are followed and if there is a dispute we help all parties move forward.’[1]

‘Unfortunately, despite being advised by council officers as to the correct procedures, BestLet instead chose to evict the tenant by unlawfully changing the locks and removing the tenants’ property and leaving it in the garden,’ he continued. [1]

Concluding, Mr Price said, ‘we take matters such as this very seriously and aim to tackle poor standards in the private rented sector and focus our enforcement action on the minority of unscrupulous landlords and agents who do not comply with the law.’[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2016/2/local-letting-agent-guilty-of-unlawful-eviction