The Government has published a draft Statutory Instrument making it a legal requirement for letting agents to belong to a redress scheme.

The order, which relates to the Enterprise and Regulatory Reform Act 2013, does not give any dates for compliance, but says it will come into force 28 days after being made.

It also stipulates that letting agents who do not comply will be fined up to a maximum of £5,000.

This is the same amount that estate agents can be fined if they are not signed up to a redress scheme.

Neither estate agents nor letting agents can be punished by being banned.

Property ombudsman Christopher Hamer told Eye yesterday: “A ban would need to proportionate to the offence and I think the Department for Communities and Local Government would see the non-registration by an agent not appropriate to a banning order, given that under the Estate Agents Act 1979 bans are only handed out for things like fraud, dishonesty, discrimination or otherwise undesirable conduct (as defined by the relevant regulations).

“The intention by CLG has been to afford as much opportunity as possible for agents to meet the obligation to register with an approved scheme, so perhaps they see the possibility of a fine as providing motivation rather than the sword of Damocles as a threat.

“Enforcement will of course only work if the enforcement authorities act on non-registrations in a timely fashion.”

Asked if he knew how many estate agents had been fined for non-membership of a redress scheme, Hamer said he was not aware of any.