A campaigning lettings agent is demanding action over what he suggests is a tenancy deposit system that is in need of drastic and urgent reform.
“This is the sector’s dirty little secret which we are exposing. Either government is aware and complicit or not aware and incompetent - there can be no excuse not to act and reform cash tenancy deposits” says Ajay Jagota, chief executive of the Keep It Simple Group.
Jagota has submitted a number of questions to ARLA, DPS and affected companies in an attempt to get to establish what has happened in a series of cases involving letting agencies where deposits have gone astray. In addition to seeking a meeting with housing minister Gavin Barwell - so far unsuccessful - Jagota is also writing to Dorset MP Michael Tomlinson for his comments.
“Renting in the UK is starting to feel like a protection racket where paying the right organisations lets you pretty much do as you please. We’ve been trying to get to the bottom of what has happened in several cases where tenancy deposit schemes, redress schemes, industry bodies like ARLA the firms [have been] involved. It shouldn’t be left to us to do that. I believe in self-regulation, but this is ridiculous” he says.
Jagota says Morgan Hampton of Wimborne, Dorset, recently became the latest letting agency to shut up shop leaving behind a queue of customers claiming their deposits have gone missing.
He says Dorset trading standards has now confirmed it is investigating the firm and has been quoted confirming: “The main allegations involve the theft of customers’ deposits.”
That case follows the incident when a member of staff of Smith Gore in Newmarket was convicted of embezzling £16,000 of tenancy deposits. The company was acquired by Savills around the time the crimes came to light.
“In the Newmarket case, the timelines suggest to me the crimes may not have not come to light had Savills not moved to take the firm over. Savills has declined to comment, but if this is the case it shows that the only people policing what lettings agencies are doing with money which belongs to their tenant’s are other letting agents” he says.
“Some £2.4 billion of deposits are currently held by letting agents in insurance tenancy deposit schemes. As our whistleblower says, if people want to act fraudulently it is really easy to do that. The entire system is in urgent need of reform.”