Regulation & Law
News articles looking at national legislation and local regulation and the application of law to the residential property industry.
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Mother and daughter property fraud pair jailed
A mother and daughter team who helped a Dubai-based gang make a false £1.2 million application for a bridging loan by taking the identity of a deceased Kensington landlady have been jailed for property fraud. 31-year-old Laylah De Cruz (pictured) is to serve a five-year sentence and 62-year-old mother Dianne Moorcroft a three year term following a trial at Southwark Crown Court, during which the pair denied the fraud. The two were part of a gang, the rest of whom are still being sought, who identified a rental property belonging to a deceased landlady and then rented it using false papers. After this, with the help of her daughter, Moorcroft changed her name by Deed Poll to the landlady’s name. She later put the property on Eagle Place in Kensington on the market and, posing as the millionaire but actually deceased owner of the property, subsequently applied for a bridging loan of £1.2 million, which she was granted. The funds were then transferred to Dubai and have since not been traced. Moorcroft was arrested at her Blackpool home in February 2015 while De Cruz was arrested on her return from Dubai, where she lived as an expat, in May 2016. Suspicious…
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New money laundering watchdog launched
The government has announced that a new watchdog is to be launched early next year to oversee the UK’s Anti Money Laundering (AML) regulations, which are due to become law this June. Called the Office for Professional Body Anti-Money Laundering Supervision (OPBAS), its job will be to tackle potential weaknesses in the supervision of estate agents that criminals may be exploiting. The new anti money laundering watchdog will be paid for by what the HM Treasury calls ‘supervisors’; the big accountancy, law and other trade and regulatory bodies. It will be based at the HQ of the Financial Conduct Authority in London. AML rules The latest version of the Money Laundering, Terrorist Financing and Transfer of Funds Regulations 2017 is designed to bring the UK in line with international standards and include “robust new standards of supervision”. They introduce new responsibilities for agents covering when and how they must carry out enhanced due diligence on customers, and how they carry out risk assessments to work out if their business is vulnerable to money laundering attempts. The regulation in particular ask agents to look more carefully at transfer of funds, a problem highlighted in January when a criminal gang based in London…
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Rogue letting agent jailed after stealing holding deposits worth £15,000
A “thoroughly dishonest” rogue letting agent in Croydon, South London has been jailed for failing to pay back holding deposits often for the same property and totalling £15,000 following a two-week trial. Thirugnanaselvam Damayantharan, also known as Mr Damo, was sentenced to 19 months in jail for the offences, which included taking multiple deposits for the same property, letting properties he had no authority to do so and failing to return deposits when tenancies fell through, despite being through no fault of the tenant. At the court hearing the letting agent denied two counts of fraudulently trading as two companies – See Own Properties and My Lawn Estates – over the past six years, although the unreturned holdings deposits related to 33 properties. See Own Properties, which is still trading but the annual accounts for which are overdue, is registered at a Regus office facility in central Croydon (pictured, left). My Lawn Estates, which advertised on Rightmove but has now been removed but is still listed as ‘active’ at Companies House, was expelled from The Property Ombudsman in 2015 for two years. During the case, which was brought by Croydon Council Trading Standards, the court heard that Damayantharan, who was…
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Landlord Action says rogue tenants are targetting free-to-list websites
Campaigning group Landlord Action has published an extraordinary warning about free-to-list advertising sites, suggesting that landlords should not to use them to find tenants because they are being targeted by rogue tenants. The comments follow last night’s Channel 5 TV show Nightmare Tenants, Slum Landlords featuring Landlord Action founder Paul Shamplina. In the episode aired last night at 9pm, Shamplina met London landlord Vicki McNaught who he says used a well-known free-to-list site to find a tenant for her property, although this is not mentioned in the episode. She says she subsequently regretted it after the tenant stopped paying his rent soon after moving in. Landlord Action says Vikki (pictured, left) listed her property with the site because it was a cheaper alternative to using a letting agent. She says that initially she was “delighted” to secure a professional tenant with a public-school background and a City job, and his girlfriend. Vikki, who was owed more than £3,000 by her errant tenant, says that people like this are more likely to target free-to-list sites because they hope they will be subjected to fewer checks. “In the future, we’d always go through an agent – although even this has no guarantee. It’s…
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Agent agrees to withdraw ‘knocking copy’ ad after ASA investigation
An agent in Andover, Hampshire has been investigated by the advertising watchdog the ASA for making competitor comparisons within a flyer. Bournes Town & Country, which has two branches in and around Andover, circulated a flyer featuring a picture of a house previously marketed by a competitor, Austin Hawk, that Bournes Town & Country had subsequently sold. The text on the flyer compared the listings of the two firms, one saying “3 viewings no sale time wasted” while the other “12 viewings sold STC success”. Additional text then said “originally advertised with your agent then swapped to Bournes”, suggesting the flyers were circulated to homes marketed by Austin Hawk at the time. The complainant about the flyer said there were a variety of factors which could impact on whether a house sold or not and challenged wither the comparison in the ad was misleading. The Advertising Standards Authority (ASA) contacted Bournes Town & Country about the complaint and it “agreed not to make competitor comparisons which included details that customers cannot independently verify in the future”, the watchdog said. It also said it had “received assurance from the advertiser they would make their future advertising compliant with the advertising rules”. The…
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Agent fined the most in Burnham-on-Sea fee fixing scandal speaks out
One of the four agents which last week agreed to pay fines totalling £370,000 following a Competition and Markets Authority investigation into price fixing in the Somerset seaside town of Burnham-on-Sea has given its reaction to the case for the first time following the announcement. The agents – which included Greenslade Taylor Hunt (GTH), Abbot and Frost, Gary Berryman and West Coast Property Services – admitted breaking competition law by colluding to set a minimum 1.5% commission fee for sales in and around the town. Charles Clarke (pictured, left), Chairman of GTH, has said that the fine covered activities during 2014 and 2015 by the company’s local business. He said that GTH cooperated with the CMA fully and that as soon as concerns were raised by the watchdog, an investigation of all offices and departments within the firm was undertaken. GTH is to pay the largest proportion of the total fine, at £186,054. “We are entirely satisfied that this issue resulted from the wholly misguided and inappropriate actions of one GTH Partner, acting entirely alone, at one branch of our group and that no other office or department was involved in any way whatsoever,” he told Burnham-on-Sea.com. “The partner’s actions…
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Four Somerset agents admit sales fee cartel and are fined £370,000
Four Somerset estate agents have admitted being involved in a price-fixing sales fee cartel in and around the seaside resort of Burnham-on-Sea and in total have been fined £372,233 by the Competition and Markets Authority (CMA). Gary Berryman Estate Agents Ltd (and its parent company Warne Investments Limited), Abbott and Frost Limited, Greenslade Taylor Hunt and West Coast Property Services (UK) were found to have colluded together to set minimum commission rates for residential sales at 1.5%. This follows a year-long investigation by the CMA. Abbott and Frost Limited has agreed to pay £30,099, Gary Berryman Estate Agents £97,807 and West Coast Property Services £58,273. Greenslade Taylor Hunt, a partnership, received the largest fine, of £186,054. FINE REDUCTIONS All the fines involved included a 20% reduction for assisting in the investigation while Greenslade Taylor Hunt received a further 15% reduction ‘for leniency’ while West Coast Property Services’ fine also included a ‘leniency’ reduction, of 35%. The cartel was brought to the attention by a whistle-blower, Annagram Estate Agents which trades as CJ Hole locally and that, consequently, has not been fined. This is part of a strategy introduced by the CMA in 2015 to persuade errant agents to report competition law…
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ASA investigates agent over number of homes sold
A recent complaint to the Advertising Standards Authority (ASA) has highlighted the perils for agents of incorrectly using sales data taken from Rightmove’s Intel tool. The case involves an estate agent in Leicestershire who was reported to the Advertising Standards Authority (ASA) for using a ‘misleading’ leaflet that used Rightmove data to claim that it had sold six properties in a specific postcode. Sales and letting agent CHQ Properties, which is based in the town of Shepshed just outside Loughborough and was set up two years ago, came to the attention of the Leicestershire County Council Trading Standards Services after it used a flyer distributed to homes in the LE11 central Loughborough postcode that included the claim ‘after selling six properties last week surely the best way of selling your property is with us’. Within its complaint to the ASA, CHQ Properties was challenged on whether it had really sold that number of properties in LE11 between 27 October and 2 November last year, as claimed. Trading Standards believed the flyer was misleading because it did not make clear which postcodes were included in the comparison, and that CHQ had not sold any properties in LE11 during that period. CHQ…
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CIELA to start pre-launch memberships from April, full launch on October 1st
The start-up of a new membership organisation just for independent estate agents called the Charter for Independent Estate and Letting Agents (CIELA) has moved on to its next phase. CIELA is the brain child of Charlie Wright, CEO of software firm Easymatch, who says independent agents need a separate organisation to help them fight against ‘corporate domination’. Charter Secretary Samantha Westlake says inauguration is due to take place tomorrow and that an interim monthly pre-launch membership fee of £35 is to be introduced for agents wanting to join from 1st April. This will be a few days before CIELA is due to launch the organisation to the press. Since announcing their intentions in January, CIELA’s 11 founding members have been consulting among independent agents, who they say have a strong desire for a ‘collective voice’. They also looked closely at several key questions including; whether there were enough issues and problems facing independent agents to justify a new organisation, whether CIELA would benefit consumers too, and whether there was enough support within the industry given the number of existing membership organisations. “It was agreed that the answer to all three questions is ‘yes’,” a CIELA briefing document circulated today reveals.…
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130,000 Brits owed £5.3bn in Spanish bank payouts, says Amanda Lamb
Queen of property TV Amanda Lamb (pictured, right) says over 130,000 British people are owed substantial Spanish bank payouts following a landmark ruling by the country’s Supreme Court. Approximately half a million Brits have bought properties in Spain in recent decades and such was the gold rush that at one point several well-known UK estate agents had overseas property sales people based in branches. The market has picked up again, too, and British buyers in 2015 made up 12.7% of all properties sold in Spain. The A Place in the Sun presenter says those who believe they lost money following the financial crash of 2008, when many people who paid in advance for newbuild properties lost their deposits when developments went bust, should contact legal firm Spanish Legal Reclaims, who she is working for. The company has launched a campaign to help Brits recoup the estimated £5.3 billion in payouts due from Spanish banks to UK investors. Monies owed range from £10,000 to over £500,000 per claim, it says. Spanish Legal Reclaims has launched the campaign using research published in partnership with the Centre for Economics & Business Research (CEBR) which shows the total pot of money to be repaid…
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