A lettings agency in central London has been issued with a fine for not belonging to a Client Money Protection scheme.
The firm is not identified but its breach was discovered as part of a London-wide clampdown on agents by Trading Standards departments.
The agency was hit with a £20,000 for the breach. “Trading Standards is increasingly acting against agents that don’t comply, meaning it is crucial for businesses to check they are displaying a valid certificate in-branch and online” says Propertymark.
There had been speculation that the agency had applied for membership of a CMP scheme and that the fine was imposed for a two day 'gap' between previous and new scheme membership. However, this now appears not to have been the case.
A Trading Standards spokesperson has told Letting Agent Today: "The agents issued with enforcement notices (a Notice of Intent) are those without CMP cover and where the CMP schemes (such as Propertymark) have all confirmed that no application has been made by that agent for CMP cover. It is quite possible that agents having received an enforcement notice will subsequently take steps to obtain CMP cover ... but that clearly cannot negate the breach from having taken place."
Agents have been legally required to belong to have CMP since April 2019.
The trade body says: “Belonging to a CMP scheme builds trust between the business and client and upholds the professionalism of the agent. It is mandatory for all Principals, Partners, or Directors of firms that act as agencies in property and handle client’s money or uses a third-party to oversee client money.
“Under the regulations, agents must display a valid certificate confirming membership. They must also provide their client money handling procedures both online and hard copy, making it available to clients free of charge upon request.”
It adds that recently over 100 agents in London have been investigated for not belonging to an approved CMP scheme.
Depending on levels of non-compliance, the agents involved faced fines of up to £30,000 each.