Deposit was paid to agent who seems to be no longer trading

Deposit was paid to agent who seems to be no longer trading

19:14 PM, 4th June 2015, About 8 years ago 4

Text Size

A tenant has recently left a property that I own and we have agreed that they should receive the full return of their £1,000 deposit. Deposit was paid to agent who seems to be no longer trading

They paid the deposit to the agent who I used to find my tenant and they used to find their property. It seems that the agent has stopped trading although I’m currently trying to confirm this and we cannot yet find the deposit in any of the approved schemes.

I am trying to do everything I can to be a responsible landlord and I’m sure they feel the same about being responsible tenants. I’ve contacted all three DPS schemes to I have ask if a deposit is currently held against my property and they have all confirmed that none is. I’ve also asked if the agent has ever been on their books and all barring DPS have confirmed that this agent has never even been on their books. DPS have asked me to email them to ascertain if the agent were registered with them so we await that response but it doesn’t look hopeful.

Unfortunately the, now former, tenants are rather upset with me which disappoints me greatly as I’ve always tried to handle the letting responsibly and generally don’t like to upset others. I’d like to settle the matter as soon as possible and want to know where the responsibility now rests. I’ve already given them the commitment that if the matter is now my responsibility I will settle it personally but, like any reasonable person I’d like to follow the proper channels to ascertain the facts of the matter before paying out. I feel caught between a rock and a hard place…

Does anyone have any advice on how we resolve the issue and where the responsibility now rests?





Mark Alexander - Founder of Property118

19:28 PM, 4th June 2015, About 8 years ago

Hi Andrew

It's bad news I'm afraid.

You are accountable for the actions of your agent. I am certain other will confirm this is the law.

Not only does this mean that you need to refund the deposit out of your own pocket, even though you never had the money, it also means that your tenant can claim compensation from you. As much as three times the deposit on top of the refund so in your case that's an eye watering £4,000!

If you are sympathetic to your tenant and refund quickly then he maybe sympathetic towards you. He may not even be aware of his right to make a clam against you. If he is though, and if he gets in with a no-win-no-fee claims management company, from what you have said, you don't have a leg to stand on if he decides to claim. You might as well negotiate and avoid the stress of going to Court.

Did your agent carry client money protection and professional indemnity insurance? If he did then you may be able to claim against that for your losses. If your agent wasn't a member of ARLA, NALS or RICS then the likelihood is that they will not have had this level of insurance protection.

If you agent has taken the money then he has committed the crime of fraud by abuse of position. Reporting such a crime to the Police though rarely produces results. They simply don't have the resources to follow through with these types of crimes and are notorious for fobbing people off by telling them it's a civil matter and to talk to a solicitor.

This is the service you need and it will be particularly effective if you can track down other victims such as yourself >>

mark smith

11:11 AM, 5th June 2015, About 8 years ago

Dear Andrew,

This seems like deliberate fraud rather than a breach of contract, and I agree with Mark A that it bears all the hallmarks of fraud by abuse of position.

Are you aware of any other LLs affected? If you can band together it would be a great help.

Please contact me via my profile to see what can be done by way of private prosecution.

Mark S

Rob Crawford

16:21 PM, 6th June 2015, About 8 years ago

Hi Andrew, assuming the money was protected within the DPS custodial scheme the DPS will have sent the tenant an e-mail with a code number. Did he receive such an e-mail?

Neil Robb

20:15 PM, 7th June 2015, About 8 years ago

You must have had decent tenants as you are returning their full deposit.

Contact them and say as you can not trace the old agent you will from your own funds return their deposit and apologise for the delay.

They are upset at the minute as they think they are not going to get anything so if they know you are going to sort this they may be happy and let it go.

You don't want them seeking legal advice. Don't mention compensation scheme or anything. Only deal with that if they bring it up.

They may be happy you have sorted this for them.

Then try pursue the old agent through small claims and the police tel them he has committed fraud.

This is why I really dislike the Deposit schemes.
! you employed an agent but you as landlord are held to account because they did not act. when they told you they had or believed they would have done the deposit correctly.

They insist the landlord write to tenant to say where deposit is with proscribed information yet they are writing anyway . Why don't they do it .

Try claiming on the deposit and it goes more in favour of the tenant time and time again.

If you steal from someone or beat them up you would be lucky to get a fine of £100.00 yet don't do a bit a of paper work and it is possibly a £4000.00 fine total joke.

Leave Comments

In order to post comments you will need to Sign In or Sign Up for a FREE Membership


Don't have an account? Sign Up

Landlord Tax Planning Book Now