Letting agent fined £12,500 for risking renters’ money

Letting agent fined £12,500 for risking renters’ money

A letting agent that “negligently failed” to protect renters’ hard-earned cash has been hit with a £12,500 financial penalty after a judge ruled in favour of the Royal Borough of Greenwich.   

Maritime Properties incorrectly stated on its website that it was part of the Client Money Protection scheme, but it had actually ignored its obligation to join the scheme for over a year.    

Client Money Protection Schemes make sure landlords and tenants are compensated if letting agents cannot repay their money, for example if they go into administration.    

It has been the law since April 2019 for letting agents to be part of a CMP scheme, but Maritime Properties didn’t sign up until June 2021, despite repeated warnings.   

The Council eventually fined Maritime Properties £12,500 in October 2021 – a sum the letting agents tried to challenge in Court, arguing it should be lower or nothing at all.   

In a hearing last month, Judge J Findlay found the Council acted correctly, insisting Maritime Properties “continued to trade without being a member of the CMP.” They ruled the fixed penalty issued by the Council was “fair and proportionate” and “took into account the severity of the breach.”  

Judge Findlay said: “While it took sporadic action to join the CMP scheme, [Maritime Properties] did not follow anything close to a reasonable fashion. In effect, its failures were so negligent that as to be tantamount to deliberate.”  

Councillor Ann-Marie Cousins, Cabinet Member for Community Safety and Enforcement, said: “I am pleased with the Judge’s findings. Examples like this show how important it for letting agents to follow the rules.  

“The Money Protection Scheme is there for a reason. It protects both renters and landlords, so it’s simply unacceptable that renters’ security deposits could be put at risk through no fault of their own.

“Letting agents must display a certificate on their website to prove they will protect your money should anything go wrong.”  

More information and advice for tenants and landlords can be found here.