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Naming and shaming

All agents must, by law, register with one of the three approved property redress schemes – and the system has just been strengthened, so read on.

The Negotiator

PRS logoThere are three government approved redress schemes for estate and lettings agents; The Property Ombudsman (TPO), Ombudsman Services: Property and The Property Redress Scheme. It is a legal requirement that all agents are registered with one of these schemes.

When transactions go wrong (and occasionally when they have, seemingly, gone well) buyers, sellers, landlords and tenants, can – and do – file complaints with the scheme that the agent belongs to.

While many complaints are rejected, or very simply resolved, others have greater impact on the agency, significant fines can be handed down and must be paid. When things go really wrong, and/or the resulting award (fine) to the customer is not paid, it can seriously damage the business and, ultimately, lead to expulsion.

Agents who believe they can simply join another scheme will be disappointed to find that the three schemes communicate to ensure that this doesn’t happen.


In June, the three schemes issued a revised version of their Memorandum of Understanding (MOU). Established to support the ongoing communication between the three redress schemes where relevant, the MOU ensures that any agent with an outstanding award with one scheme will not be accepted by another until that award is settled.

If an agent is expelled from membership due to a breach of its Terms of Business, the MOU will now allow for total transparency and the sharing of information with the press, property portals, The National Trading Standards Estate Agency Team (NTSEAT) as well as the expelled agents’ local Trading Standards office.

Refusing to fully co-operate with a complaint doesn’t make it go away. Without information from the agent, the complaint is likely to be supported. Katrine Sporle, TPOS.

Katrine Sporle imageThe Property Ombudsman, Katrine Sporle, said, “Registering with an approved redress scheme is a legal requirement for both sales and letting agents in England. ‘Naming and shaming’ expelled agents that have not fulfilled their obligations and are not able to legally trade is in the public interest. The scheme responsible for expulsion will provide consumer protection by publicising the news via their website and media outlets and inform regulators.”

Property Redress Scheme’s Sean Hooker, said, “Agents should be fully aware that the consequences of not complying with the decisions of the redress schemes are severe, and that the close co-operation of the schemes will ensure that the consumer can be reassured that they are protected from poor industry practice.”

We are sending a clear signal to all agents that we are collaborating to drive out poor practice in the industry – good news for tenants. Lewis Shand Smith, Ombudsman Services: Property.

Lewis Shand Smith imageOmbudsman Services: Property, Lewis Shand Smith, says, “The announcement and our strengthened Memorandum of Understanding should send out a clear signal to all agents that the redress schemes are working collaboratively to drive out poor practice in the industry. This is good news for tenants who can be confident that our strong working partnership means we are acting together in the interest of all consumers to provide greater protection.”

Other revisions relate to the transfer between schemes. These include:

  • To clearly define the actions required if an agent makes an application to one scheme having previously been a member of another, but there are ongoing complaints.
  • To identify who is responsible when a company changes redress schemes, but a complaint arises where issues occurred during membership with the previous redress scheme.

The Property Ombudsman (TPO)
London Corporate Apartments Ltd (LCA) was expelled from The Property Ombudsman (TPO) scheme for failing to pay an award following a rental deposit dispute. LCA’s expulsion prevents the firm from registering with TPO for lettings or sales redress for two years – and an agreement between all the existing redress schemes means that LCA will not be able to register for any form of redress until the award is paid.

LCA’s expulsion followed a complaint concerning the return of a deposit at the end of a rental agreement. The complainant contacted TPO after they were unable to resolve the dispute with LCA. The complainant disputed the deductions made from the deposit and also claimed that the agent had failed to return the deposit in a timely fashion.

Katrine Sporle, Property Ombudsman said, “Agents that agree to join our scheme must offer consumers the highest safeguards. This agent failed to investigate the original complaint satisfactorily and did not provide any written evidence to contradict the claims made against them about the rental agreement and the disputed deposit deductions.”

The Ombudsman reviewed the complaint and found the agent fell short of the standards required. The Ombudsman instructed LCA to pay an award of £340 as full and final settlement. LCA failed to pay the award and was expelled.

Katrine added, “Refusing to fully co-operate with a complaint does not make the issue go away. In this case, I had the rental agreement and other information from the complainant but no information from the agent.

I therefore decided that the complainant’s version of events should be accepted and the complaint supported. By refusing to pay the award, the agent is now unable to trade and risks a fine from Trading Standards should they try to do so.” If an agent is expelled from TPO for failing to pay an award, they are reported to Trading Standards and are at risk of a fine of up to £5,000 for each branch found to be breaking the law by trading without redress registration.

LCA was last known to be trading from Unit 107, 93-101 Greenfield Road, London E1 1EJ (Company Number: 08896663).


AMF Estates t/a Hill Estates based in Heywood, Greater Manchester was expelled from membership with the Property Redress Scheme after failing to make an award of £1,000 to a Landlord Complainant.

The decision began following receipt of a complaint from a Landlord claiming that Hill Estates had not undertaken contractual arrangements. This included failure to inform the Landlord that the previous tenants had moved out of the property, leaving the Landlord unable to complete a check-out inspection. The Landlord was later made aware of considerable damage to the property including structural changes and the effects of keeping a prohibited pet in the property – both of which were allegedly agreed to by the Agent.

In the absence of a check-out inspection, it was not possible from the evidence provided to establish whether this damage had been caused by the previous or current tenants. The Agent maintained that they returned the deposit directly the previous tenant.

The Landlord also claimed they had not received any rent from the new tenants and that Hill Estates failed to provide an Energy Proficiency Certificate (EPC) or protect the current tenant’s deposit under a Tenancy Deposit Scheme.

Failure to pay an award, however large or small, is a serious breach of our Terms of Reference. It will not go away if they refuse to engage with the scheme. Sean Hooker, PRS.

Sam Hooker imageHead of Redress, Sean Hooker, did not deem the Agent liable for breaches of the tenancy by the current or previous tenant and therefore made no award for damages or unpaid rent to the complainant.

However, following a full investigation, Mr Hooker instructed Hill Estates to pay £1,000 to the Complainant in lieu of missing deposits and failure to remove rubbish and furniture left by the previous tenant, as per their commitment to do so. Hill Estates did not pay the award and had their membership suspended pending further investigation by the Head of Redress and expulsion was subsequently ratified by the board.

Sean Hooker said, “Failure to pay an award, however large or small, is a serious breach of our Terms of Reference. Agents must not assume that the complaint will go away if they remain silent and refuse to engage with the scheme.


TPO logoThe TPO scheme offers an independent and impartial dispute resolution service to consumers who have been unable to resolve their disputes with a registered agent. Established in 1990, the Ombudsman can provide redress to place the consumer back in the position they were before the complaint arose, achieving full and final settlement of the dispute and all claims made by either party. The Ombudsman can make compensatory awards in individual cases up to £25,000 for actual and quantifiable loss and/or for aggravation, distress and/or inconvenience caused by the registered agent’s actions.

TPO is free to all consumers. Agents pay a single annual subscription covering them for sales, lettings, commercial, international and auction activities. TPO does not charge case fees.

At 31 December 2016, over 15,315 sales offices and 14,613 letting offices were registered with TPO. We estimate that these figures represent 95 per cent of sales agents and 85 per cent of lettings agents operating within the UK.


PRS logoThe Property Redress Scheme is newest of three government authorised redress (ombudsman) schemes established to help resolve consumer complaints made against letting, property management and estate agents and other property professionals.

Currently the choice of over 6,000 property agents across the UK, the PRS aims to raise standards and give consumer confidence in the property industry.

Membership fees for agents start at £95 + VAT. The PRS does not require members to follow a Code of Practice.

The PRS operates by providing consumers with an escalated complaints procedure against unfair treatment by property professionals, such as surprise charges, misrepresentation or unacceptable service.

The PRS is administered by HF Resolution Ltd, part of the Hamilton Fraser group, and is governed by an Independent Advisory Council consisting of experienced representatives from all areas of the property industry. www.theprs.co.uk


Ombudsman Services logoApproved by Powys County Council as an estate agents redress scheme and by the Chartered Institute of Trading Standards Ombudsman Services: Property resolve consumer complaints about property firms that have signed up to their service. These include:

Chartered surveyors that are members of the Royal Institution of Chartered Surveyors (RICS); surveyors; Residential managing agents, including those that are members of the Association of Residential Managing Agents (ARMA); Residential letting agents, including those that are members of the National Approved Letting Scheme (NALS) or the UK Association of Letting Agents (UKALA) and other property professionals.

Ombudsman Services: Property decisions are binding on the firm and enforceable in court. It can require: a range of remedies and financial awards up to £25,000. In 2016 Ombudsman Services: Property helped over 5,600 complainants and resolved 1,166 cases.

August 7, 2017

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