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Confiscation orders on landlords could set precedent for private rental sector

A local authority claims that a court decision may set a legal precedent for other councils across the UK using the Proceeds of Crime Act.

The follows a Crown Court judge’s order to a family of landlords who crammed 31 tenants into one property to pay thousands of pounds in fines, costs and confiscation orders.

Mother and daughter Harsha and Chandni Shah, along with Harsha Shah's brother Sanjay Shah, were pocketing around £112,000 a year by housing 31 people in a four-bedroom house in Wembley.


They were assisted by Jaydipkumar Valand, who was acting as their agent and collecting rent from the tenants.

Enforcement officers from Brent council also found a woman living in a lean-to shed in the back garden of the property during a raid on the premises in July 2016. 

The shack had no lighting or heating and was made out of wood offcuts, pallets and tarpaulin.

Her Honour Judge Wood of Harrow Crown Court made a Confiscation Order for the sum of £116,000 against Harsha Shah and Chandni Shah under the Proceeds of Crime Act 2002. Valand was also subjected to a confiscation order for the sum of £5,000.

Harsha Shah, Chadni Shah and Sanjay Shah were sentenced to pay £41,000 in fines. All the defendants were ordered to pay £82,367 in costs. The total payable amounted to £244,367.

A confiscation order was not awarded against Sanjay Shah because the court was not persuaded that he had benefitted from his criminal activity in running the illegal, overcrowded HMO. 

However, the judge held that that he had played a key role in facilitating the illegal operation and fined him along with the other defendants.

A Brent council spokeswoman says: "We will use every legal power we have to come down hard on landlords and agents who exploit tenants in Brent. Every house in multiple occupation needs a licence, which helps to create decent living standards in the borough. We will track down landlords who do not licence their properties and rip off tenants by housing them in miserable conditions."

During the raid in 2016, enforcement officers found some residents sharing a single bed with night workers swapping sleeping shifts with those who worked during the day. Four beds were discovered piled into the front room and three in each bedroom.  

Previous case law had indicated that confiscation orders could not be obtained in cases such as this. But Brent says councils from all over the country are now using Brent's historic legal win as a precedent.

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    Whilst this case is very extreme it could set a dangerous precedent knowing what councils are like. They despise landlords and will start grabbing properties left, right and centre.

    Landlords are being bashed enough. Something like this will drive them away in their thousands. Who will house these tenants then?


    AM I reading it right? I thought it means confiscation order of £5000. Using the proceeds of crime act. Not the property itself?

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    This is downright racist. There is no other way of putting it. These people live like this in the countries where they come from and this absolutely normal for them them. What gives us the right to judge them?. Why on earth do we think they are superior to them? We let them come and live with us and then we turn round and do this to them.

    Being serious, letting councils confiscate property is a basic tool of communism. It is a hideous thing which is slowly increasing in our society. By all means confiscate the property but it should go into a proceeds of crime channel.

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    It is not racist, it is dealing with a criminal act. House overcrowding purely for profit is both dangerous and inhumane. In this particular instance, the court was correct. It is time that social responsibility was at the forefront of reasonable and prudent letting management rather than benefiting purely on the hardship of others. Decent housing should be a priority for any provider be it in either the private or public sector. This is not a judgement on the culture of housing abroad but of the culture of housing in this country and, I, for one, am happy it will not be tolerated.

    S l
    • S l
    • 18 December 2018 10:10 AM

    I think you miss the point. Housing and contract are effectively a civil matter. Unfortunately it's turning into a criminal issues with the council who work against landlord. Not with landlord. Most of us do it by chance or for pension n to be face with criminal charge is just too much. These people may have actually ask to do it because they can't afford the rent . They only want a roof over their head n to try get a job n then better housing. We are lucky to be in welfare state. Not all countries are n they have to live by their own limited means. Perhaps the better solution is to impose a law that all companies mudt employ at least 10% of foreigners so that these people can have a decent start in life.

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    Totally agree with Liam. People move to the UK for a better standard of living. Do you have 31 people living in the house next door to you Fred Jones?

    S l
    • S l
    • 18 December 2018 10:13 AM

    A better standard of life only comes with a job. If the local company prejudice against foreigners n not employ them n rather employ our own, how do u think they have the expectation or the means of a better life?

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    Unless it burns down. Then the owners and tenants get a free pass and compo.

  • S l
    • S l
    • 18 December 2018 10:05 AM

    That is awful. Can't imagine how the landlord does that and not expect to get caught. I once letnout to a guy as family home. He put his "cousin and wife" in the house. But every time when I do inspection or went to collect rent, there is a big bunch of Romanian taxi drivers n I told him it's family home, these people are not allow to stay there. He assured me they are friends over for coffee. And I reminded him of the no smoking clause. The next thing I knew, I got council at my throats for having 7 individuals in a 4 bedroom house doing caution n interviews excercising their criminal powers . One of the guy , not my tenant complain to the council wanted Upvc windows. I evicted the lot of them as my tenant was nowhere in sight with 2 months rent arrears n strangers in my property. Needless to say, these tact drivers were following my kids from house to school q-kidnapping? And they punctured my tyres when saw my car in town.

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    In the current market it is wise to have a broad portfolio. There are practical issues with overcrowding not only for the tenant but also for the landlord. For the tenant this will likely be access to basic living requirements and health and safety, for the landlord increased wear and tear, dispute and potential for criminal prosecution. Building control notes minimum requirements for amenity which must always be adhered to. The main issue is that a properly managed asset would never lead to this situation as it is in no ones interest. This particular case was about greed not about maximising generated income.


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