BBC investigation exposes level of disappearing deposits

BBC investigation exposes level of disappearing deposits
For too long it has been the letting industry’s dirty little secret that deposits can be used as personal piggy banks which firms can dip into whenever they see fit.

The investigation - featuring contributions from renting reform campaigner Ajay Jagota - examined the issue of money which goes missing from insurance-based Tenancy Deposit Schemes.

£2.4bn of the UK’s £3.2bn tenancy deposits are held in these schemes, which see deposit money handed over by renters retained by their landlords or letting agents. Research by Jagota shows landlords and letting agents were convicted of embezzling more than £1m from these schemes in 2016.

The programme investigated the case of Cornwall letting agency Premier Property Management, which currently owes clients more than £35,000 in deposit cash.

At the time of broadcast, the firm was listed as a member ARLA Propertymark, the regulatory body designed to “reassure all of those renting and letting out property that agents who display the Propertymark Protected logo offer better protection for their clients”.

The listing disappeared from ARLA’s website in the immediate aftermath of the programme, but Premier Property continues to advertise itself as a member of the organisation, which this week promised that when renters see their logo they can be reassured that “they and their money are safe”.


MP Oliver Colvile, who has campaigned for tenants' rights, described the case as “appalling” adding “clearly there needs some action to be taken on all of this”. Ajay Jagota has written to Mr Colville offering him the opportunity to discuss in detail possible action the government could take to reform renting in the UK.

The BBC investigation was broadcast the same week as letting agent Tahir Khan was jailed for 45 months by Bolton Crown Court for illegally holding onto £130,000 of deposits paid by tenants.

The conviction takes the totaliser of tenancy deposits stolen so far in 2017 to £146,000.

Ajay Jagota, founder of North East sales and lettings firm KIS, had this to say: “It’s a significant milestone that the mainstream media is picking up on a major scandal which could engulf the entire private rented sector at any second.For too long it has been the letting industry’s dirty little secret that deposits can be used as personal piggy banks which firms can dip into whenever they see fit.

In the age of insurance, there is no need for cash deposits to be taken at all, with landlords better off protecting their properties against careless tenants in the same way they would protect their own homes. It’s ironic that all of this news comes the same week ARLA has relaunched itself as the knight in shining armour who ‘stands for protection for the consumer’.

That doesn’t seem to have happened on this occasion. In fact, all that has happened is any reference to this company, whose customers put their faith in because they were ARLA members, disappearing from the ARLA website faster than their deposits!”

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Comments

  1. MattMatt20 February 2017 14:34:05

    Is this fake news?

    Reply to this comment

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