Client Money Protection (Declined) as a letting agent – help?

Client Money Protection (Declined) as a letting agent – help?

10:01 AM, 2nd August 2021, About 11 months ago 9

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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



Comments

Mark Alexander - Founder of Property118 View Profile

10:57 AM, 2nd August 2021, About 11 months 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.

BernieW View Profile

11:46 AM, 2nd August 2021, About 11 months ago

Perhaps you could team up with someone already protected?

Graham Bowcock

11:52 AM, 2nd August 2021, About 11 months 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.

Mark Alexander - Founder of Property118 View Profile

12:18 PM, 2nd August 2021, About 11 months 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

BernieW View Profile

12:20 PM, 2nd August 2021, About 11 months ago

Reply to the comment left by Graham Bowcock at 02/08/2021 - 11:52
Metro Bank > Southampton Row, London > Iain Cameron

Graham Bowcock

12:35 PM, 2nd August 2021, About 11 months 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.

BernieW View Profile

14:01 PM, 2nd August 2021, About 11 months ago

Reply to the comment left by Graham Bowcock at 02/08/2021 - 12:35
That's why I mentioned a specific name, Graham.

Karen Lettings

20:51 PM, 24th November 2021, About 7 months 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

Graham Bowcock

9:20 AM, 25th November 2021, About 7 months 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

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