Several influential industry bodies have thrown their weight behind a review into whether Client Money Protection should be mandatory for letting agents.
Yesterday we reported that the government had launched a consultation exercise - closing on October 3 - seeking the views of agents and others in the industry as to whether CMP should be mandatory.
Housing minister Gavin Barwell, launching the consultation, says industry estimates suggest letting agents currently hold approximately £2.7 billion in client funds “but if a letting agent is not covered by client money protection, both the landlord and tenant could stand to lose their money.”
Now Isobel Thomson, chief executive of the National Approved Letting Scheme, says the industry should rid itself of illegal and fraudulent practices.
“We’re delighted to see .. that Government has recognised SAFEagent’s campaigning for full and mandatory CMP. NALS will be responding fully to the consultation to inform the argument that all agents should be covered by CMP, and we urge others to do so too. We hope this review will finally lead to mandatory CMP for all letting agents” she says.
SAFEagent has long campaigned for mandatory CMP and has warmly welcomed the consultation.
“Quite simply, the industry wants it, and all members of licensing, professional and trade bodies already have it” says John Midgley, chair of the SAFEagent steering group.
“It’s worth adding that cost is not an issue here. Government should recognise that the cost of CMP is a small price to pay by an agent who genuinely wants to protect their clients and consumers” suggests Midgley.
The government calculates that under the current voluntary arrangements, some 60 to 80 per cent of letting agents have signed up to a CMP scheme.
Another body, the Residential Landlords Association, has also backed making CMP mandatory.
“Landlords should be concerned about agents having control over monies rightly due to them and they should obviously be protected through a formal scheme. It is ironic that estate agents are legally required to be registered yet don’t handle money, yet agents handling tenant and landlord money are at present free to do what they like. We believe CMP schemes are an essential measure” says association chairman Alan Ward.