How many more times?
How many more times will there be administrations which leave a bad taste in the mouth?
How many more times is the trade press going to have to report letting agents stealing deposits and rents – and just about getting away with it?
How many more times these feeble sentences?
Administrations
Far too many administrations seem like cosy arrangements purpose-designed to get inept or criminal business people off the hook while simultaneously depriving victims of the chance of getting justice – let alone the chance of getting their money back.
At the time, in April 2014, local paper the Sentinel reported David Whitefield as saying: “We are still running as a business, but the holding company has gone into administration.
“We will continue to operate under new ownership, so the vast majority of our clients will remain unaffected by the change.
“We have chosen the administration route for a variety of reasons, which were chosen to safeguard the future of the 14 jobs here and retain as many of our clients as possible and make sure people can still sell their properties.”
He added: “Some of our clients have outstanding monies owed from tenants, and some tradesmen have outstanding sums from maintenance work carried out on properties, but we estimate that only 15% to 20% of our clients on the lettings side have been affected.
“We sympathise with the people who are out of pocket, but as a limited company we acted under the instructions of our administrators.”
Deposit protection
Then there is the issue of deposit protection.
There is no doubt that the system works – mostly.
But, as this case demonstrates, it is not completely consumer-proof. Both the industry and the public need to have absolute confidence in it and there may have to be changes.
The most obvious is that where custodial protection is used, the tenant should be able to place their deposit money directly into the relevant scheme. That way, there is zero opportunity for a crooked agent to get their hands on the money.
Client money protection
A law making client money protection insurance for all letting agents mandatory is long overdue, again amply demonstrated in this case. Yet the latest move, by Baroness Hayter, is not even supported by the Government.
How shameful.
Still no regulation
Letting agents should, of course, also be regulated in order to protect consumers and the reputation of the whole industry.
As the law currently stands, convicted agents cannot be banned from the industry in the same way that estate agents can.
There is at the moment nothing to stop David Whitefield working in either lettings or sales, although he cannot be a director.
Feeble sentence
As for the feeble sentences, one can only say that a two-year suspended sentence does not seem much of a deterrent to someone whose business has helped itself to over £120,000 of other people’s money.
Could he have been stopped?
The public is a good whistle-blower and in the case of Whitefield Properties, they did their best.
First they went to Trading Standards which acted, although they have had to wait two years for what now seems like hollow justice.
And second, they tried to put the word out in virtually the only way that they could at that time.
The reviews on allAgents are mostly damning and should have deterred any prospective customer.
Two other things stand out: first that the firm was also in sales, and if the reviews are correct, took fees up front.
One review says: “Have been trying to sell our property though Whitefield now for 12 months they are a waste of time. They have your money up front and that is it. They’re not interested after that.”
Second, in the sea of appalling reviews, one gives the firm five stars: “Fantastic. Rented out my property quickly and efficiently. Superb knowledge of the industry and local market. Helped me to avoid potentially costly mistakes. Very pleased with Whitefields. Very happy to recommend and use again.”
One problem with review sites, however, is that the public has not heard of them and we suspect often does not check them out until it is too late and something has gone wrong, and it is only then that a wronged customer does some due diligence.
And shouldn’t a sudden five-star review amid some damning ratings automatically make any review site sit up and take notice?
Comments (7)
Don’t take deposits ?????? rather a very risky business that…… UNLESS H.M. Government start to level the playing field and make it a Criminal Offence to destroy, damage, etc the property they have rented, together with an appropriate sentence.
I think it is a crime called “Criminal Damage” but the police, as usual, always tell people it is civil matter because they don’t want the paperwork. I had a tenant arrested for stealing item from the house (fridge, cooker etc) but I had to insist on it and do the legwork and tell them where the tenant had gone. What really rubbed was the tenants were just formally interviewed and cautioned as it was a “first offence”and I had no say. They were not happy when I suggested I be just cautioned if I have a “first Offence” speeding ticket!!!!!!
The answer is deposit protection should ONLY be available via a custodial scheme that the tenant places their money directly into. Why this wasnt the case from the start I do not know. But these situations seem few and far between, so no need to go all over the top regulatory and put more red tape on small businesses.
On the issue of review sites, they are a joke. A mentally ill person can leave a scathing ‘review’, and there is no way it can be removed, nor is there any redress or complaints procedure (allagents) that gets any meaningful response. And yes to counter said slanderous comments all you can do is put up as many more realistic ones as possible, some clearly doing it themselves. Utterly pointless and its a good job the public rarely use them without prompting.
“…as to the suitability of the tenant (that should be achieved through rigorous rerencing and affordability checks).”
B0110ck$. If you believe that then you are seriously deluded, Sir.
Dont take deposits??? – obviously not a letting agent! – Does not matter how stringent the checks are deposits are needed. Lets say they have an accident and burn the kitchen counter (easily done) once they have left how will you get the money back?
CMP – is just a smoke screen, only penalises good agents. Even if it was compulsory the rogue agents will still not buy it.
But i do think if you have been found guilty of the above you need a ban from the industry for a good number of years.
Compulsory CMP would be a start. An opportunity to include mandatory membership of a CMP scheme for agents holding deposits was lost when drafting the 2008 Tenants Deposit Scheme. Rogue agents and landlords would have been unable to qualify for CMP.
Don’t take deposits is a start, it’s outdated and proves nothing as to the suitability of the tenant (that should be achieved through rigorous rerencing and affordability checks). Don’t agree that the system “works” – many cases reported show it doesn’t and how easy this type of fraud is, these are the cases we hear about, I and many in the industry are aware of many more the public do not hear about.