Not a single rogue letting agent has been prosecuted under new laws designed to protect tenants from excessive fees, poor quality homes and misleading adverts- despite the scheme being up and running for over eight months.
Figures obtained by sales and lettings firm KIS show that no North East local authority has used new powers to fine letting agents for failing to sign up to a mandatory tenant redress scheme introduced last year.
Research from Citizen’s Advice estimates that 20% of letting agents have not signed up to the scheme.
KIS asked the five Tyne and Wear councils the following question: “How many fixed penalty notices have been issued since 01 October 2014 to letting agents who are not members of an approved redress scheme under the provisions of SI. 2014 No.2359 Redress Schemes for Letting Agency Work and Property Management Work (Requirement to Belong to a Scheme etc.) (England) Order 2014”.
The following responses were received.
|Fines made to letting agents who are not members of an approved redress scheme
KIS originally sought figures from the Ministry of Justice, and was told that the information was held by the Department of Communities and Local Government.
The Department of Communities then informed the firm that they did not hold this information and referred KIS to individual local authorities.
One North East authority initially claimed that it was not their responsibility to collect the information.
Since October 2014 letting agents have been required by law to sign up to one of three government-approved redress schemes designed to give the people they rent homes to a recognised independent place to take their complaints.
The schemes – run by the Property Ombudsman, Ombudsman Services Property and the Property Redress Scheme – assess the complaints and can award compensation where appropriate.
It is a criminal offence for a letting agent not to be a member of a redress scheme, and local councils can issue fines of up to £5000 to agencies which have not signed up.
Earlier research by KIS showed that 99.5% of tenants were unaware of the redress scheme’s existence.
KIS Founder and Chief Executive Officer Ajay Jagota responded to the figures:
He said: “It would be nice to think that the absence of any fines for letting agents not joining a mandatory redress scheme means every single agent has signed up to one – but with Citizen’s Advice estimating that one in five agents haven’t, that seems to be a little fanciful.
“My concern with the scheme has always been that it isn’t clear who exactly is enforcing it. What’s alarming about our research is that at least one of the enforcers didn’t seem to know either!
“We found agents who don’t seem to be members of any of the schemes with no more than five minutes of Googling. But it doesn’t look like anyone else is even doing that.
“Not joining a redress scheme is a criminal offence. Just imagine if this was any other criminal offence like robbery or drunk driving and no-one at all was attempting to stop it. It would be a national scandal.
“These laws have been brought in to protect the public, but with 99.5% of the public not knowing they’re there and the authorities apparently unable to enforce them, you have to ask if they serve any purpose at all”.