According to a recent investigation by newsbeat, many
letting agents are taking thousands of pounds from tenants as a holding fee for
their properties – then keeping the money without letting them move in. Many
tenants have reported depositing money for down payments, then having the
rental cancelled and the payment never returned to them. This fraudulent
behaviour has many tenants concerned about being ripped off by these
unscrupulous agents.
According to the Trading Standards Authorities in England,
487 of these fraudulent down payment cases were reported from the year January
2011 to September 2013. Also, a Freedom of Information request discovered that
71 of the 200 trading standards teams in England had received at least one
complaint about this issue. In some of these cases, the landlords never
actually existed and in other cases the agents were also stealing money from
the landlords.
Also, the Trading Standards Institute claims that due to the
way that the information was recorded – the real number of victims could
possibly be a lot higher. Based on past
surveys, they know that many of the people who are ripped off will not bother
reporting it, because they know that nothing is going to be resolved even if
they try.
For example, according to a story by the BBC, a 22 year old
woman named Rachael Kennedy paid a letting agent £1,800 as a deposit on a home
that she wanted to rent. On the day before she was supposed to move into the
house, the letting agent cancelled the rental and told her she could no longer
move in. He promised that he would pay back the deposit, but he didn’t. It was
later discovered that the particular agency was being investigated since last
summer about other cases that dated back to 2009.
It is thought that letting agents should have stronger
regulation in order to stop them from ripping off tenants in this way. In
Scotland it is illegal for letting agents to charge holding fees and the Welsh
government is planning to instil new laws that will crack down on agents
ripping off their clients. At the moment, there is no regulation in Northern
Ireland.
The issue at the moment is that just about anyone can set up
a letting agency. With the lack of supervision and regulation, this opens up
the possibility of letting agents being dishonest with the proposed changes
that the coalition government wants to instil will require all letting agents
in England to sign up to an independent scheme. This means that they would be
forced to pay compensation if anything went wrong. Adding more regulations to
letting agents will help to stop had behaviour and will make it clear that
fraudulently taking money from tenants is not acceptable.
If anyone has experienced this themselves, they should report
the incident to the trading standards department of their council. The council
will have the power to prosecute this illegal theft of funds.
Our advice is always to do your homework before handing over
money and always to use a reputable landlord or letting agent.
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