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Southwark Council Cracks Down on Prohibited Landlord and Letting Agent Fees

Southwark Council upholds the rights of private rented sector tenants, not to be charged banned fees by landlordand lettingagents. The council raised a case against Portico Property Limited that saw the company pay a financial penalty of £2,000, for breaching the Tenant Fees Act.

This relatively new legislation was introduced to protect tenants, by limiting the fees that can be charged by landlordand letting agents.

Portico Property Limited’s registered office was in Southwark until October 2021. It was penalised by the council because it required a tenant to make a payment of £195, for leaving joint tenancy of a flat in Camden, at the end of its term, when other parties to the joint tenancy wished to continue.

Government guidance says that such a charge should not be more than £50. Although agents are allowed to charge more if the amount of their reasonable costs are higher.  Any attempt to charge more than £50 must be backed up with evidence of these costs.

Emails sent by the company in June 2021, demanded an upfront: “outgoing/exiting tenant fee” of £195. However, the tenant challenged this, asking for evidence of their costs in line with the guidance, which was not provided.

When the tenant said they were going to escalate the matter to the Property Ombudsman scheme and notify trading standards, the company reduced the fee to £50, as a “gesture of goodwill”.

Councillor Darren Merrill, Cabinet Member for a Safer, Cleaner Borough, said: “It is disappointing that we had to take action in this case, as the guidance to agents is quite clear. Thankfully, this tenant knew their rights and refused to pay the banned £195 fee. However, it should never have been presented in the first instance.

“We are committed to improving standards in Southwark’s private rented sector. I am pleased that thanks to the work of our trading standards team, this company has been punished for breaching a law that is intended to protect tenants.”

Portico’s website says it has 15 branches across London. Since the breach occurred, Portico Property Limited has been acquired by the Leaders Romans Group and its registered office has moved to Wokingham.

People who are looking to rent, or who are already renting, privately in London, can check and see if their agent or landlord has been fined, as in this case. Further information on trading standards and the private rented sector can be found on the council website.