Agent trying to comply with law told by bank to open 90 different client accounts

An agent trying to open a separate client account was gobsmacked to be told by his bank that he needed to open up separate accounts for each and every one of his landlords.

The agent is trying to meet the April 1 deadline for compulsory Client Money Protection.

A basic requirement for CMP schemes is that the agent must hold client money separately.

However, the agent was told by Lloyds that he could not open one pooled account, but would need to open one for each landlord – in his case, that would mean some 90 accounts.

The agent, a single-office business in Warrington, told EYE: “We manage about 100 properties for landlords, who mostly have just one property each.

“To open and run 90 different client accounts would mean that I would have to employ a full-time accountant.

“We are a small business, and what the bank is asking is impossible.

“Talking to their call centre, it appears that this is Lloyds’ own internal policy.

“However, the one account per client rule is completely unworkable.”

The agent said that he has been told by his CMP scheme, Client Money Protect, that he and others in the same position can get cover but on the basis that they move from Lloyds to another bank within a year.

Lloyds confirmed to EYE yesterday that it does require agents to open and manage multiple accounts, and that agents would have to check each client at the point of opening every account.

It appears that this is because agents are not regulated by the FCA.

A Lloyds spokesperson told EYE: “We offer a range of different account types to best meet the needs of our small business customers.

“To ensure compliance with the new money laundering regulations, we’re no longer able to offer Undesignated Client Accounts to property managers and letting agents.

“However, these customers can continue to open Designated Client Accounts, and our business relationship teams are on hand to guide them through this process.

“We apologise for any inconvenience that this may cause, however our priority is to ensure that our customers remain compliant once the new regulations come into effect.”

Eddie Hooker, CEO of Client Money Protect, told EYE: “It has been brought to the Government’s attention that some banks are not in a position to open a client account for letting agents.

“The Government has requested that authorised schemes give letting agents a grace period of 12 months starting from April 1 to open a client account if it can be shown that they are trying to obtain one from a UK regulated bank.

“The position of Client Money Protect is that we want to assist agents with complying with the law so we will adhere to the grace period, but we expect evidence from the letting agent that they are in process of obtaining a client account.”

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  1. Robert May

    Compoooooter says…. No!

    1. NewsBoy

      We have exactly that. One account for each landlord. It is just good practice

      1. Robert May

        Good practice  is a  single client cash account that is reconciled and balanced once a month  to a double entry  client cash accounting system that has a full audit trail, operated with full separation of duties.
        The reason the computer will say no to client cash accounts is because the banks do not want lots of accounts that have relatively small  fleeting balances and lots of tranactions, exactly the sort of account banks lose money on operating.

        1. DASH94

          Had exactly the same conversation with Lloyds – referred to it here a week or so ago.   It’s so frustrating.

          Nat West will do a Bankline Client account, but it’s £2.50 for each same/next day bank transfer.    It used to be nil – but they changed it in October 2017.

          Separate accounts for each landlord would be a nightmare for us.   We use Jupix and have a client account that is reconciled daily – it works well if you can get the bank charges under control

          1. Robert May

            There’s good reason Jupix PM works that way (winky face)!

    2. Local Independent

      Agree with Robert on this one.

  2. AgencyInsider

    ‘You’re not alone…’ with Lloyds Bank

    Unless you want to do something ludicrous like open a client account .

    In which case it is ‘Neigh, neigh, and thrice neigh’.

  3. Ouch18

    Move across to Santander By far the best for business banking and we had a client account open in no time.
    We was with Yorkshire Bank and they had the same stupid rule, one for each client

    1. Woodhen

      Santander are insisting on separate accounts for each landlord. We have in excess of 320 Landlords ….how do you run an automated payment system from management software programmes that link into the bank. The same problem importing your bank statement for payments into your account. The banks have created the technology and now not letting us use i!,,,,

      1. Ouch18

        We have one client account for all landlords which was set up 3yrs ago with Santander

        1. Benfield

          I second that. We switched to Santander couple of yrs back after 15yrs with RBS. £7.50 p/m each account. Two accounts, business and client. Saved a small fortune, wish I had switched years ago. Thought it would be too much hassle, but it wasn’t.


          1. Lands

            We’re with Santander, and very happy with them, although they told us just the other day if we went to them today to set up a new client account, we would need an account for each landlord (5000 in our case!). Plus we’d have to conduct KYC process on each client!! They told us this is the way most banks are approaching clients accounts these days.

            But I have no sympathy. Why are there any letting agents operating out there without a separate client account? The first rule, surely!

            1. Woodhen

              Exactly the problem I had…..been with them for 20 years but Client Account with BOS and switch gave me same problem.

  4. jeremy1960

    Does anyone else remember the days when banks had managers who were respected, intelligent educated and able to make logical decisions rather than the pen pushers that we have nowadays?

    A ludicrous situation which is totally unnecessary provided the account is entirely separate from office account and is reconciled every day.

    1. Robert May

       Ahhhh 1993! 

    2. MF

      Yes!  The late 80s & early 90s in my case.  The good old days, much missed.  I do my best to avoid bank manager meetings nowadays as their sole interest is flogging me one of their financial products.

  5. Jimmy Independent

    Barclays can help you out too on a fully compliant set-up if you want to lighten the load.

  6. The Outsider

    It’s almost like different banks offer different services to differentiate themselves from others!


    Who’d have thought it?

  7. revilo

    Quite ridicuous!

    We bank with Lloyds – and have no problem with running our client deposit account.

  8. Oliver Wharmby

    The difficulty is there is no standardisation at a national level. Each bank does what they like at local level.

    1. Robert May

      Can you imagine wandering into an open plan Lloyds lounge and explaining  to the yoof your yoofs went to school with  what a client cash account is and how it works?


      So you collect money for 200 landlords some of which have more than one property? On different day of the months you want to pay in rent sometimes on the same property from different tenants?….. errr can I interest  you in a cashback credit card?

  9. Peter

    The problem with targets, great way for a bank manager to achieve theirs!

  10. Nick Harris

    We had this recently – it seems that Lloyd’s are not open for new business with our industry.

    A quick call to Nat West and all was sorted.

    1. Woodhen

      Natwest is part of the Bank of Scotland Group which also owns Lloyds

      1. Peter

        Maybe several hundred years ago. I think you need to get up to speed.

        1. HIT MAN

          NatWest is part of the RBS not the BoS which is part or Lloyd’s and Halifax group

  11. Ted.Nugents.Shirt

    Individual accounts for every landlord is not only a waste of time but i’s stupid. In this case I blame the banks.
    Monzo a British challenger bank (founded in 2015) is working on business current accounts. Currently their personal accounts can be pooled. In addition they’ve just won Best Banking App presented to them by the British Bank Awards.
    If there is one thing that annoys me it’s banks running legacy software. The big banks have been caught sleeping and it’s having a knock on effect on their customers.

    1. P-Daddy

      Totally off piste and few will understand but…all hail Ted Nugent!  Doesn’t that bank Monzo sound like the name of a song title he would use 🙂

  12. zenagent81

    In reply to Lands The agents did have client accounts already with Lloyds, however Lloyds decided off their own bat to no longer recognize it as such, in my case I had a client account for over 15 years. I only found this policy change out when I needed a bank letter to confirm client account status for CMP insurance cover. Surely Lloyds have a moral / legal duty to inform their letting agents they had made this decision to move the policy goal posts. Given the knock on effect of not holding a client account (when you thought you did) the agents were put in breach of the PI condition and TPO terms etc. Poor (none) communication from Lloyds which could some agents at risk if they assumed everything regarding their client accounts was totally compliant.    

  13. Harry Albert Lettings Estates

    We had the same thing. 70 forms were sent for each client, 6 pages each…


    We moved to Natwest.


    Lloyds are farsicle. When I applied for CMP and asked them for a letter confirming current client account, they informed me it was actually a regular savings account that they’d renamed Client Deposit Account.



  14. Woodentop

    Lloyds don’t want the business …. from within!


    Now how does a  solicitor cope, especially with conveyancing …. separate account per person?

    1. GeorgeHammond78

      Solicitors are regulated – unfortunately, we’re not (yet)


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