Countrywide yesterday admitted two counts of not following Royal Institution of Chartered Surveyors (RIC) rules on client money protection during a disciplinary hearing in Birmingham.
Following the hearing it has been reprimanded and told to pay a £100,000 fine.
The disciplinary action by RICS follows the revelation that between 2008 and 2018 Countrywide moved a total of £10.09 million of client funds from the company’s client account to its office account.
Under RICS guidance no member of permitted to move funds in this way and therefore RICs say Countrywide ‘failed to preserve the security of client funds’.
During the hearing it was explained that the estate agency had transgressed two rules of conduct.
These include that its conduct represented a ‘serious and prolonged disregard’ toward the firm’s professional CMP obligations, and that it had failed to avoid ‘any actions or situations that are inconsistent with its professional obligations’.
No loss to customers
But despite admitting to breaking the Rules of Conduct and moving money when it was not permitted to, Countrywide has released a statement explaining that ‘customers did not suffer any loss’ during the ten-year period when ‘many thousands’ of untraceable small sums were moved over.
“Back in 2008 we started to accumulate many thousands of individual small amounts on client accounts in our lettings businesses, where funds over six years old could not be traced to source,” the company says.
“Some would have been rightly Countrywide funds and others small amounts of landlord/tenant sums that could not be traced.
“It was agreed at the time to move these untraceable amounts to an office account and put in place an indemnity that, should ever a recipient be identified, the amount would be paid across.”