Redress scheme left us ‘high and dry’ after expulsion of rogue agent, say landlords

Landlords and tenants who say they have been defrauded by a rogue letting agent have hit out at one of the government-authorised redress schemes.

They said the Property Redress Scheme was “useless” when it came to protecting them in their dealings with Carter Stones, and that after expelling the agent, the scheme left them “high and dry” with nowhere to go.

The agency, of Ilford, Essex, was yesterday featured in the BBC radio programme You and Yours. The same agency has also featured on EYE.

You and Yours said several landlords had contacted it, complaining about unpaid rent, or legal documentation, and claiming multiple people are living in the properties without any right to be there.

Landlord Doni Soeyono bought a small two-bedroom terrace house 18 months ago as a rental investment.

He signed up with Carter Stones which promised him that a couple would rent the house for about £1,300 a month.

But the couple Carter Stones claimed were renting the property did not live there.

Instead up to eight other people were in residence. Mr Soeyono has not received any rent for six months.

He managed to get inside the house last  autumn and took pictures showing the sitting room with several beds.

When a BBC reporter went to the property with Mr Soeyono, they were shouted at by two women who told them to go away.

Mr Soeyono said he had seen one of the women a number of times and believes she lives in the property, helping to operate a sub-letting ring involving about 16 people.

Another landlord, Teresa, whose family have owned a two-bedroom terrace home in Ilford for over 30 years, signed a management agreement with Carter Stones and was assured that a couple would be living in her house.

“Alarm bells rang when the council contacted me to ask who was responsible for the council tax at the house,” Teresa said.

“They said many people were living in the house, but not the couple on the tenancy agreement.”

Teresa says the people seen coming out of Mr Soeyono’s house are also organising the sub-letting not only of her house but also her garage.

She said: “Carter Stones declined all responsibility for this. They were not transferring me the rent and I couldn’t get any sense out of them, even after telephoning them on a daily basis.”

The You and Yours reporter said: “I tried to talk to Carter Stones, but while I could see two people in their office, each time I knocked they hid behind the door.

“Since 2014 it has been a legal requirement for letting agents to be a member of one of three government-approved dispute resolution schemes: the Property Redress Scheme, the Property Ombudsman or the Ombudsman Service.

“The Property Redress scheme costs £200 to join. It is run by the insurance company Hamilton Frazer, and unlike the two other organisations, it is run for profit.”

Last year the PRS upheld four complaints against Carter Stones but the company failed to pay compensation of £15,406, and last September its expulsion by the PRS was announced.

While this expulsion made it illegal for the firm to continue trading, Carter Stones stayed in business.

In November, Shakeel Ahmed paid £2,350 as a deposit to secure a flat to rent.

Even though the flat fell through, Carter Stones kept his money.

When the landlords and prospective tenants complained to the PRS, they were told that as Carter Stones had been expelled from the scheme, nothing could be done.

Mr Soeyono said: “The PRS is pretty much useless.

“When things go wrong, they simply expel the agent and cast its customers adrift.”

Teresa said: “The PRS is not effective at all, absolutely not in the case of a rogue agent. They’re just using the scheme for their benefit.”

The PRS was also criticised for having no code of conduct, and for not publishing on its website a list of companies that have been expelled.

Paul Shamplina, who is on the PRS advisory council, said that none of the redress schemes are regulators, but are “escalated complaint-handling schemes put in place to prevent service related complaints from having to be issued in the court by consumers.

“This allows them access to a much quicker and cost-effective remedy to resolve matters with property agents.”

He told the programme that following expulsion from a redress scheme, “the bigger picture is the lack of enforcement”.

We have invited the PRS to comment further.

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  1. Chris Wood

    Without commenting on this case in particular, the main problem in the industry stems from a chronically underfunded Trading Standards team and a misconception of what a redress scheme is able/ permitted to do in law.

    With individuals companies, traders and even PLCs seemingly able to trade with either no redress or despite having been banned, the problem is a lack of enforcement. With little to no effective enforcement, bad and illegal practice builds to fill the void. Law-abiding agents are forced out and anarchy ensues with consumers, the rule of law and the good-guy’s being the principal losers.

    1. SueStretch65

      Who actually disliked this???

      1. Chris Wood

        I have an idea it’s probably someone from REDACTED

  2. Headache

    Replace chronically underfunded with lazy.

    1. Robert May

      On what basis are you making that comment? Within 12 months of  announcing what he was going to do,  tackle CPR and BPR,  [there was a story  published in Eye September 2015] James Munro was doing exactly that. The clampdown on #portaljuggling, the clampdown on agents trading without redress  and other matters currently in hand show that despite the budget restrictions NTSEAT is beginning to make headway.

      I reported a serial portaljuggler  via the  process NTSEAT have established [also reported on Eye  October 2016?] and found staff knew all about the practice and the process of tackling #portaljuggling agents. The portaljuggling stopped without a court case and the  educated agent is now trading within the rules that govern everyone.

      NTSEAT can  now identify any agent trading without redress, live. that means  rogue agents will get shut down. That doesn’t sound like lazy to me

      1. Chris Wood

        I see the REDACTED crew are busy on the dislikes this morning

  3. jeremy1960

    Couldn’t agree more, even when I advise our local tso of agents breaching regulations nothing happens! We still have agents in our town who do not even display fees correctly!

  4. FromTheHip64

    So who owns Carter Stones. C’mon, name and shame.

    1. Mark Walker

  5. smile please

    Interesting to know PRS is a for profit organisation and the other two are not. did not know.

  6. Frown Please

    Does this not count as theft?

  7. FromTheHip64

    Surely this is straightforward theft and an obvious case for the police to investigate.


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