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Greenwich letting agent fined £12,500 after falsely claiming to belong to a client money protection scheme
A letting agent that falsely claimed to belong to a client money protection scheme – placing both landlords and tenants at risk – has been ordered to pay a £12,500 financial penalty after a Tribunal Judge ruled in favour of the Royal Borough of Greenwich.
Maritime Properties incorrectly stated on its website that it was part of the Client Money Protection scheme, but it had actually ignored its obligation to join the scheme for over a year.
Client Money Protection Schemes make sure landlords and tenants are compensated if letting agents cannot repay their money, for example if they go into administration.
It has been the law since April 2019 for letting agents to be part of a CMP scheme, but Maritime Properties didn’t sign up until June 2021, despite repeated warnings.
Greenwich Council eventually issued Maritime Properties with a civil financial penalty of £12,500 in October 2021 – a sum the letting agent tried to appeal, arguing it should be lower or nothing at all.
In a hearing last month, Judge J Findlay found the Council acted correctly, insisting Maritime Properties “continued to trade without being a member of the CMP.” They ruled the fixed penalty issued by the Council was “fair and proportionate” and “took into account the severity of the breach.”
Judge Findlay said: “While it took sporadic action to join the CMP scheme, [Maritime Properties] did not follow anything close to a reasonable fashion. In effect, its failures were so negligent that as to be tantamount to deliberate.”
Councillor Ann-Marie Cousins, Cabinet Member for Community Safety and Enforcement at Greenwich Council said:
“I am pleased with the Judge’s findings. Examples like this show how important it for letting agents to follow the rules.
“The Money Protection Scheme is there for a reason. It protects both renters and landlords, so it’s simply unacceptable that renters’ security deposits could be put at risk through no fault of their own.
“Letting agents must display a certificate on their website to prove they will protect your money should anything go wrong.”
All letting and managing agents that hold client money must belong to one of six government approved client money protection schemes. More information can be found in a safeagent letting agent enforcement toolkit that London Property Licensing helped to develop last year, available here.
Our free guide containing more information about property licensing and HMO planning rules in the Royal Borough of Greenwich is available here.
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