The Property Ombudsman has expelled three property businesses from its redress scheme after they failed to pay compensation awards totalling over £1,000 to consumers.
The action follows a review by the scheme’s independent Finance, Performance and Compliance Committee, which determined that Musgrove & Co, Tothill Residential Surveying Ltd, and Coles Property Management should be excluded for non-compliance with Ombudsman decisions.
The expulsions highlight ongoing challenges within the property sector regarding regulatory compliance and consumer protection. The move comes as property professionals increasingly support reforms aimed at improving transparency and accountability in property transactions.
Case details
Musgrove & Co, operating as Musco Property Limited in North Walsham, Norfolk, faced a complaint from a landlord regarding tenancy handling. The issues included refusal to transfer a holding deposit, errors in the tenancy agreement, and failure to respond to formal complaints. The firm did not provide evidence during the Ombudsman’s investigation, resulting in a £300 compensation award.
Tothill Residential Surveying Ltd, based in Mundon, Essex, was subject to a complaint from a buyer who paid £500 for a survey report that was never delivered. The Ombudsman directed an £800 award following its review.
Coles Property Management, registered as C.P.M (NW) Limited in Blackpool, received complaints from a landlord concerning the management of two rental properties. The firm delayed transferring tenants’ deposits and forwarding rent payments to a new agent after termination of its management agreement. Communication failures were also identified, leading to a £100 award.
Industry implications
Chief Ombudsman Lesley Horton stated that Ombudsman awards are mandatory, not optional, and that expulsion represents a last resort. “We work with businesses throughout the compliance process to help them meet their obligations and ensure consumers receive the awards they are due,” she said.
Horton noted that only three businesses reached the point of expulsion this quarter, demonstrating that most firms comply with decisions and pay awards without requiring ultimate sanctions. The enforcement action aims to maintain consumer confidence in the redress scheme, particularly as estate agencies face increasing operational pressures.
“Consumers must be able to trust that redress has real meaning,” Horton added. “Where a business ultimately fails to comply, we will take appropriate action to protect consumers and maintain confidence in the scheme.”
The expulsions serve as a reminder to property businesses of the importance of regulatory compliance and the consequences of failing to honour redress obligations to consumers.
