Finance News

One in Five Landlords and Tenants Unprotected by Client Money Protection

Rose - June 6, 2016
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One in Five Landlords and Tenants Unprotected by Client Money Protection

One in Five Landlords and Tenants Unprotected by Client Money Protection

At least one in five landlords and tenants are not protected by Client Money Protection (CMP), according to a new study.

Research by YouGov, conducted on behalf of SAFEagent, shows that hundreds of pounds of landlords’ and tenants’ money held by letting agents is at risk because the funds are not protected by CMP.

Letting agents in the UK currently hold over £2.7 billion of landlords’ and tenants’ money in the form of rent payments and tenancy deposits. However, at least 20% of landlords and tenants would be unable to recover their funds if an agent stole the cash or used it fraudulently, as their money is not protected under the CMP scheme.

With around 61% of tenants incorrectly believing that their money is protected by law, the SAFEagent Awareness Week kicks off today, highlighting the importance of CMP for landlords and tenants when letting through an agent.

Although compulsory CMP is now finally on the Government’s agenda, through amendments to the Housing and Planning Bill, many consumers are still at risk. Therefore, SAFEagent is campaigning for full and mandatory CMP.

The Chair of SAFEagent, John Midgley, explains: “If an agent were to steal landlord or tenant money without CMP in place, there’s little chance of getting their money back. Would you use a travel agency who isn’t ABTA protected? Consumers who use agents without CMP in place are taking a massive risk.

“While we are finally getting closer to mandatory CMP, we aren’t there yet. It is so important that tenants and landlords understand that the right to redress only goes so far, and they need to choose their agent wisely by asking if they are part of a CMP scheme before signing on the dotted line.”

Find out more about SAFEagent Awareness Week (6th-10th June) on the firm’s page: http://safeagents.co.uk/awareness-week/