The director of a West Midlands lettings agency with three branches that collapsed in February owing creditors £1.3 million has blamed the tenant fees ban and Covid on its demise.
Homepoints estate agents Ltd, which went into liquidation several weeks ago, has told creditors that its financial difficulties were due to a significant extent to the lost revenues driven by the fees ban.
Owner Ajit Singh Pooni also said that the first Covid lockdown reduced its fees income by half but that after reopening in May when the housing market was allowed to revive, revenues remain substantially reduced.
But despite these claims, Pooni and his former agency are now being investigated by local trading standards.
This follows a liquidator’s report that revealed the company owed £118,145 in unprotected deposits and that rents totalling £459,553 had not been passed on to landlords.
Client money protection scheme CMP, which Home Point was a member of, says these two creditor groups will be covered. The first landlords and tenants have already approached it to make claims.
But trading standards are concerned enough by the collapse of the firm to investigate how it came to owe such huge sums.
Councillor Nicolas Barlow of Dudley Council told local newspaper the Express & Star that: “Our trading standards officers are currently investigating concerns raised in regards to this company and we are therefore unable to add anything further at this stage.”