Safeagent has written to all of its agents in England urging them to check legal requirements when setting up or operating a client account, following the rise in alternative banking products.

As a government-approved provider of Client Money Protection (CMP), Safeagent must ensure that as a scheme it complies with legislation and that its agent firms hold client money in a bank or building society authorised by the Financial Conduct Authority.  This is required as part of the Client Money Protection Schemes for Property Agents (Approval and Designation of Schemes) Regulations 2018.

Safeagent has advised its agents to check their relevant accounts are set up with organisations authorised as a bank or building society on the Financial Conduct Authority’s (FCA’s) register and not as another entity.

Isobel Thomson, Safeagent’s chief executive, said: “CMP regulations have improved consumer confidence in financial protection which is why we campaigned for their mandatory introduction.

“There is a growing range of alternative banking products available to agents. While many of these options offer convenience and flexibility, agents must complete their due diligence to ensure they comply with the regulations on holding client money, if used for that purpose.

“The message is simple: if in doubt, ask your provider if they are FCA registered as a bank or building society.

“We know our agents are committed to fulfilling their CMP responsibilities – and we have had enquiries from some already to check whether the suitability of products during the CMP renewal process.

“We therefore wanted to ensure all our members are clear on what’s required and where they could risk unknowingly and unintentionally falling foul of rules.”