Landlord complaint leads to letting agent expulsion from Ombudsman scheme

Landlord complaint leads to letting agent expulsion from Ombudsman scheme

0:03 AM, 27th March 2024, About 3 weeks ago 4

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A letting agent has been expelled from The Property Ombudsman (TPO) scheme for failing to address a landlord’s complaint and pay a £3,100 compensation award.

The expulsion of Key Lettings and Property Management follows a series of issues including failing to register deposits, withholding rent payments, neglecting to provide crucial documents and ignoring the landlord’s formal complaint.

The Property Ombudsman’s investigation into the Kent-based agent revealed a concerning pattern of unprofessional conduct.

That conduct also includes failing to register deposits for two properties, potentially exposing the landlord to legal issues.

‘Importance of upholding professional standards’

Rebecca Marsh, The Property Ombudsman, said: “While expulsions are rare, this case highlights the importance of upholding professional standards and fulfilling awarded compensation.

“This serves as a cautionary tale for agents who neglect their duty of care to clients.”

The TPO also reveals that Key Lettings had retained the final rent payment for one property due to an unverified commission fee deduction.

They also neglected to provide regular account statements or promptly notify the landlord of outstanding debts.

Notably, they couldn’t provide evidence of these supposed fees.

Ignored requests for relevant tenancy documents

Adding to the landlord’s woes, Key Lettings repeatedly ignored requests for relevant tenancy documents from both the landlord and the new letting agent.

They also failed to acknowledge the formal complaint or provide any response to The Property Ombudsman.

The Property Ombudsman has awarded the landlord £2,000 in compensation and directed Key Lettings to pay an additional £1,100 deposit to the new agent.

Despite initial partial payments, Key Lettings refused to settle the remaining £1,100, leading to their expulsion from the TPO scheme.

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16:15 PM, 27th March 2024, About 3 weeks ago

I had prospective tenants provide false information and as a consequence they lost entitlement to the the return of their Holding Deposit in accordance with the Tenant Fees Act 2019, Schedule 2.

When I asked my Letting Agent about it, all I was told was that they were keeping it.

Surely that Holding Deposit should revert to the Landlord NOT the Letting Agent?

Does anyone know whether the Letting Agent is entitled to hold on to the Holding Deposit and not give it to the Landlord? This smacks of a racket to me. Maybe something else for the Property Ombudsman to investigate?

Reluctant Landlord

16:38 PM, 27th March 2024, About 3 weeks ago

Reply to the comment left by SimonP at 27/03/2024 - 16:15
Interesting point (another good reason why I self manage!)

Write to the agent you are talking about asking them to clarify their position exactly with reference to evidence to prove the same if they intend to keep the holding deposit, as you intend to vigorously pursue this with the PO should their response not suffice.

That should shake their feathers as they are obligated to respond if you make it clear it is a formal complaint you are making


16:59 PM, 27th March 2024, About 3 weeks ago

Reply to the comment left by Reluctant Landlord at 27/03/2024 - 16:38
When I asked about the Holding Deposit, the manager at this Leading Letting Agents said "The holding deposit isn’t for the landlord to keep ".

I disputed his assertion and told him that the money should have come to me, not my Agent. That was 2 days ago and he hasn't replied.

I am now beginning to believe all the negative reports I keep reading about this Leading Letting Agent, especially about them pushing No Deposit Options on to tenants. I accepted NDOs twice but when I saw what a rip off it was to both tenants, and landlords, who are NOT indemnified as advertised, I refused to be involved in their obvious money-making scheme.

Reluctant Landlord

17:50 PM, 27th March 2024, About 3 weeks ago

Reply to the comment left by SimonP at 27/03/2024 - 16:59Read carefully their contract with you and also the holding deposit form they will have sent to the tenant. Ask the agent to see the holding deposit form that the tenant signed. If it still is not clear, get them to qualify their stance on email to you and explain/provide clear evidence why they believe this to be so and they have the right to retain the HD for themselves.
The way I understand it, is that the Agent works for you and as a result if you instruct them to conduct checks etc on YOUR behalf on a proposed tenant, then they should relay the details of these checks to YOU. If the checks come back and something is amiss (as you have explained) then it is down to them to present this info to you because it is you that determines if you wish to enter a tenancy with the tenant or not on the back of this info. YOU are named on any potential AST and the contract would ultimately be between you and the tenant.
Acting on your behalf does not give them rights over a claim to any holding deposit (unless there is something in the contract with you that makes this expressly clear). It could also be the case they have not been honest with the tenant either on who retains the HD too.

Also have a look on the PO website for past complaints raised - is there something similar on here to refer to?

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