Landlords and tenants have been left £16,000 out of pocket following the expulsion of six letting agencies by The Property Ombudsman (TPO), with complainants having no practical route to recover their money.
Analysis by compliance platform The Letting Partnership of the agencies expelled by TPO earlier this month revealed that in two cases, the agencies had no client money protection (CMP) cover in place at the point of expulsion, while in a third case, cover had lapsed.
Missing client money protection
Brimar Property Services, which was expelled over £950 of missing client money, had no CMP cover at the time of its expulsion. Skampi, where a total award of more than £5,000 was made covering rent owed, management fee refunds and compensation, was also found to have no active CMP cover, with £3,250 remaining outstanding.
Hunter Ashley, which was expelled after more than £12,000 of client money could not be accounted for, had previously been registered with a provider, although its cover had lapsed.
The cases highlight ongoing challenges in the letting sector, where small estate agencies continue to operate under varying compliance standards. The issue comes as property sales have been cited in 43% of tenant evictions in England, adding further pressure to the rental market.
System gaps identified
Chris Mason, chief operating officer of The Letting Partnership, said: “The expulsions are a clear example of the gaps that can exist within the current system. Whilst the industry has multiple compliance schemes in place, there is no single, independent process that gives everyone the same verified picture of whether an agent is compliant.”
Mason added that agents can currently be compliant with one scheme while falling behind with another, or allow their cover to lapse without any consistent mechanism to identify and flag the problem. The Letting Partnership has proposed a single, independently verified annual audit recognised across the industry.
Conclusion
The expulsions underscore the vulnerability of landlords and tenants when agencies fail to maintain proper client money protection. With £16,000 in total awards remaining unpaid, the cases demonstrate the financial risks faced by those using letting agents without adequate safeguards in place.
