Client Money Protection (Declined) as a letting agent – help?
Hi all, I recently started a letting agency. I registered my company in 2018, but didn’t really do anything until late 2019. I have only been doing let only for the time being until I branched out into management.
My let only was slightly different as I only stopped after introducing the tenant and doing the agreement – I wasn’t involved in management etc. Client Money Protection (CMP) wasn’t needed at this point. I’m in the process of offering full management and doing full let only.
I then went to apply for CMP with CMP themselves, and they have not offered us membership due to working capital being negative.
I need CMP desperately – what can I do, as I believe other providers won’t accept you if you’ve been refused elsewhere?
Looking for solutions, please.
Luellal
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One or two estate agents?
Member Since January 2011 - Comments: 12212 - Articles: 1418
10:57 AM, 2nd August 2021, About 5 years ago
You need to correct your negative working capital position. In other words, invest into your business or stop doing business as an agent illegally.
Member Since April 2020 - Comments: 159 - Articles: 1
11:46 AM, 2nd August 2021, About 5 years ago
Perhaps you could team up with someone already protected?
Member Since January 2020 - Comments: 559
11:52 AM, 2nd August 2021, About 5 years ago
You may also struggle to get a clients’ account from a bank. After years in the business I had a new start letting agent last year and the banks are not at all keen on offering clients’ accounts – despite an excellent personal track record (and RICS membership). We had to define our AML policies to the bank; our main bank were not very helpful. We did eventually get an account, but had to be persistent.
Member Since January 2011 - Comments: 12212 - Articles: 1418
12:18 PM, 2nd August 2021, About 5 years ago
Reply to the comment left by BernieWales at 02/08/2021 – 11:46
Teaming up with someone who is already covered is a great idea.
I suggest a call to Chris Sheldon who is the Managing Director at LettingSupermarket.com – Free phone: 0800 098 8844
Member Since April 2020 - Comments: 159 - Articles: 1
12:20 PM, 2nd August 2021, About 5 years ago
Reply to the comment left by Graham Bowcock at 02/08/2021 – 11:52
Metro Bank > Southampton Row, London > Iain Cameron
Member Since January 2020 - Comments: 559
12:35 PM, 2nd August 2021, About 5 years ago
Metro Bank were recommended to me and I tried them. Unfortunately the theory was better than the practice. It was taking a long time to make progress and I’m not sure the manager really understood the concept of a clients’ account.
Member Since April 2020 - Comments: 159 - Articles: 1
2:01 PM, 2nd August 2021, About 5 years ago
Reply to the comment left by Graham Bowcock at 02/08/2021 – 12:35
That’s why I mentioned a specific name, Graham.
Member Since November 2021 - Comments: 1
8:51 PM, 24th November 2021, About 4 years ago
Reply to the comment left by Graham Bowcock at 02/08/2021 – 11:52
Hi Graham, I am struggling with the same situation because Lloyds are closing our client account, despite 16 yrs trading history, due to wanting designated client accounts per property (I would therefore need over 400). Would you mind sharing which bank you were able to get an undesignated client account with please? Many thanks Karen
Member Since January 2020 - Comments: 559
9:20 AM, 25th November 2021, About 4 years ago
Hi Karen
We are with Barclays. No issues over general clients accounts, although I have banked with them for many decades (although also bank with Lloyds too!). Barclays have provided bonded accounts as required by our regulators.
Individual client accounts is a nonsense for a lettings business.
Graham