The case of a Tyneside letting agent jailed after stealing almost half-a-million pounds from her employers proves the need for urgent change in the rental industry warns property boss.
Rental manager Angela Clift was this week jailed for two years after pocketing £400,000 she was supposed to be collecting on behalf of landlords for Newcastle property firm Keith Pattinson – in what the judge described as “breathtaking” offending.
Police seized expensive handbags, clothing, footwear, jewellery and a sports car from her and her partner’s homes after colleagues became suspicious when Clift had a pair of £500 sunglasses delivered to work.
Ajay Jagota, founder of sales and lettings firm KIS, believes the case shows the need for change in an industry where an estimated £500m of rental deposits are believed to be illegally held: “Although I wasn’t in court to hear the exact details of this case, incidents like these are the inevitable outcome of an industry where too much money is flowing around unnecessarily with inadequate oversight over where it ends up. You’ve got tenants handing over hundreds and thousands of pounds in deposits and rent, and landlords acting in good faith that it will be money will dealt with appropriately. Of course most agents do just that, but five minutes on Google will show you that that is not always the case.
We’re not just talking about a few quid here and there. We’ve got £500m of rental deposits apparently held illegally and firms collapsing owing hundreds of thousands of pounds – sometimes having been given a clean bill of health by industry watchdogs. And those are just the cases were hear about. That can’t be right.
The simplest solution is to stop taking deposits and move to an insurance-backed model. It’s not just that it works perfectly well in other industries, it’s that you’ think it was ludicrous if people did it any other way. If you rent a car, you don’t hand over hundreds of pounds before you’re given the keys on the understanding that you’re guaranteed to crash it!
The overall value of UK rental deposits is estimate to be £3.2bn. Having people handing over so much cash to an under-regulated industry is something which can’t continue – not when there are simple and effective solutions under our noses.”
