Landlord Action, a company specialising in tenant eviction and troubleshooting throughout the UK, has had to turn its hand to debt collection on behalf of landlords who have fallen fowl of rogue lettings agents.
Paul Shamplina, Director of Landlord Action comments, “not only are we evicting bad tenants for landlords but, in the last 6-12 months, we have seen a huge increase in instructions from landlords asking us to carry out debt recovery proceedings against lettings agents who have not passed on the rent but withheld for their own use, even though the tenant has been paying regularly and on time.”
One such landlord is Sarojini Patel who has spent the past year trying to find out exactly where her rent has gone after she employed the services of Graceview Residential Lettings in Slough. Ms Patel thought that she had a legitimate contract and was protected against her tenant not paying the rent. What she hadn’t bargained on was that, although her agent had been collecting the rent regularly, in full and on the due date, this was not being passed back to her. The contract she thought she had was not between her and her tenant, but between her and Graceview who went on to sublet her property using their name as the landlord and after having installed second hand furniture which she is unsure fits the legal requirements. Ms Sarojini explains, “One excuse after another has been used by the agent to explain why the rent has not been paid to me, usually around the fact that the tenant has not paid. However, I went to see the tenant face to face and established they had paid and had the receipts to prove it. They were also able to produce a receipt for a deposit which, again, the agent had told me was not paid. I am now in arrears with the mortgage and, as a single mum with four children to look after, would really like to get this sorted which is proving impossible as the owner of Graceview will not engage with me.”
Another victim, Everton Francis, used Wintrust Residential in East London to let his property and encountered similar problems. He ended up over £5,000 out of pocket, even though his tenants had paid regularly. He no longer has any redress as the company has closed down.
Paul says that there are several problems associated with trying to reclaim the money in these cases, “the landlords that come to us may not be the only ones that these agents have withheld money from and the company may also have other debts so, it’s a race against time to try and collect the money before either someone else gets there first, or the company just shuts down.
The police often aren’t interested, stating that it’s a civil matter and, before they will take criminal action, they will ask for numerous victims witness statements to show that the agent has carried out serial theft. Trying to get trading standards to help can also be difficult, leaving the landlord feeling they are fighting a losing battle and no one is on their side.”
Ian Potter of ARLA states that, “although we are hearing of non members behaving in this manner, there have been no members brought to our attention which highlights the importance of any landlord wanting to let their property, or any tenant wishing to take up a tenancy, using an agent this is a member of ARLA. Then, if the agent should disappear with the clients’ funds, they would be protected under the client money protection scheme. All ARLA would require is adequate proof of the non receipt of funds by the landlord.”
In finalisation, Paul comments, “we believe landlords should make checks into the letting agent, obtain a client reference and also see if they belong to ARLA or NAEA. The new legislation for agents to be registered can only be a good thing for the industry, which will stop decent lettings agencies getting a bad name due to the rogue agencies that tarnish the industry”.
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