Client Money Protection Scheme Amendment

August 23, 2016

It is estimated that letting agents currently hold approximately £2.7 billion in client funds on behalf of renters and landlords, this can be for a for a range of reasons, including deposits, rental payments, and money for repairs.

If the letting agent is not part of a Client Money Protection scheme (CMP) clients could possibly lose vast sums of money if the letting agent goes bankrupt or commits fraud.

The government is to review whether tenants or landlords money held by the agent is adequately protected from letting agent fraud or bankruptcy.

Presently lettings agents sign up to the CMP scheme voluntarily, the government consultation will look to amend the Housing and Planning Bill 2015 so that the scheme becomes mandatory, the amendment will require letting agents to have a protection system in place for monies received by them in the course of their business from tenants, prospective tenants or any other person who is renting accommodation or seeking accommodation to rent.

Allen Walkey

Highly experienced businessman with a successful career in property sales and investment both in the UK and abroad. Now a freelance writer and blogger for the property and Investment Industry, keeping readers up-to-date with changes and events in a rapidly changing world.

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