An eight-year-old lettings agency has been expelled from The Property Ombudsman (TPO) over a disputed £200 holding deposit.
The Lettings Shop (TLS) based in West Bromwich took the payment from a tenant who the next day said they wanted to withdraw their offer and have their deposit returned.
When TLS informed the tenant that the deposit was non-returnable, the dispute was eventually referred to TPO, who awarded the tenant £200 plus £50 for wasted time and distress.
TPO said that although the deposit was flagged by TLS as non-returnable, the tenant felt they had been ‘pressurised’ into paying the deposit, against Competition and Markets Authority (CMA) guidance.
In its adjudication, TPO also said the CMA guidance states that a holding deposit should be returned if “the tenant pulls out of the deal before the relevant costs or disbursements covered by the pre-tenancy payment have actually been incurred by the agent”.
TLS has now been banned after both refusing to cooperate with TPO’s investigation or pay the award, and local Trading Standards have been informed about the expulsion.
The company vacated its high street premises (pictured) two years ago and this summer transferred its managed properties to a new business in Wolverhampton, but still has an online presence which claims the company is a member of TPO. In October TLS applied to Companies House to be struck off its register prior to being dissolved, but this action has subsequently been suspended.
“As a member of TPO, agents are obliged to comply with awards made by the ombudsman which TSL has failed to do,” says Gerry Fitzjohn (left), non-executive director and chairman of TPO’s finance and performance committee.
“As part of TPO’s role to provide better consumer protection, we feel it is important to raise awareness of cases such as these in the event that TLS attempts to continue trading with landlords and tenants who may be unaware of the company’s position, particularly as they are still advertising properties ‘to let’ via their website.”