An agent has been banned from managing companies for five years after failing to safeguard £28,000 worth of tenants’ deposits and rent which was meant for landlords.
The Insolvency Service has announced the results of its investigation into Jane Hipkin Russell’s conduct.
She was sole director of Jonathan Waters Estate Agents, in East Anglia.
After it collapsed into liquidation, the Insolvency Service found that Russell, 51, of Frinton-on-Sea, Essex, had failed to protect deposits.
Russell had worked for the Ipswich-based estate agents for many years before acquiring the company in September 2014.
However, it went into liquidation in August 2018.
Investigators found no record of 11 tenants’ deposits totalling £12,000 received between March and August 2018; while deposits received between April 2017 and August 2018, totalling £20,000, had not been protected by a government-authorised scheme.
The company had also collected just over £7,000 rent from tenants between March and August 2018.
Instead of being paid to landlords, it had been spent on the general running costs of the business.
In total, there were just over £28,000 losses.
The Secretary of State has now accepted a disqualification undertaking from Russell, the ban becoming effective this Friday.
For five years she is banned from being a director, or from being directly or indirectly involved, without court permission, in the promotion, formation or management of a company.
Insolvency Service senior investigator Rob Sheils said: “A fundamental part of Jane Russell’s role was being responsible for safeguarding money on behalf of her tenants and landlords, something she failed to do prior to the company falling into liquidation.
“This disqualification should serve as a deterrent to other directors who safeguard money from doing likewise.”
However, one landlord owed money by the agency said that the ban was little remedy. Landlord Anthony Molyneux paid £975 in fees, but has received only £35 back from the administrators. He said: “I feel we have all been failed by the system.”
Jonathan Waters sold his eponymous agency to Jane Russell in 2014, as he needed to become a full-time carer for his mother. The business was then run under the same name until it went into liquidation.
Waters himself returned to the industry last year, calling his new business, in Ipswich, Foxhall Estate Agents.
Back to the future for agent who sold up five years ago – and is starting over again
She is not the first and won’t be the last
Loads and loads of EA’s are doing this.
They use the deposits to cash flow their business and then scrape around at the end of tenancies to pay it back or find reasons of to not refund it.
The only true way to safe guard deposits is custodial schemes……
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Yes, Yes, Yes. The only true way to safe guard deposits is custodial schemes……
And a mandatory clause in the tenancy agreement of the consequences if the tenant does not get confirmation/due process of custodial scheme = No hiding!
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
This is the second or third similar article in a week and its ironic in the same week it was ‘quietly’ announced a further years grace for CMP. To the best of my knowledge, a year ago, there was no period of grace and it was a three line whip.
i guess there are not enough trading standards enforcement officers to deal with the scale of the problem and they are now delaying by another year in the hope things improve. Wishful thinking!
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
”The only true way to safe guard deposits is custodial schemes……”
Yes, she should have got 3 years!
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Where is the Proceeds of Crime Order to get the sale of her house to reimburse the debtors – It happens with Landlords and other Agents but seems to be only sparodically used. ?
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register