Read the latest news from the Housing Minister and TPO's national letting fees campaign, which will be targeting two new locations over the coming weeks. This edition also highlights CTSI's national campaign to help more consumers find reputable firms and an interview with TPO's DSC Chair to highlight how her role is helping the scheme raise standards in the industry.
Letting agents across the country will soon be required to protect rental monies through an approved Client Money Protection (CMP) scheme, following the recommendations made in a new Government report published this week.
TPO was one of several industry organisations called to provide evidence for the working party, which was chaired by Baroness Hayter and Lord Palmer of Childs Hill.
The Housing Minister has now confirmed that agents will be required to protect the client money they handle. Announcing his decision on Twitter, Gavin Barwell MP said the government will consult on details shortly, before posting a link to the CMP report.
Lord Best, TPO’s Council Chair, expressed his support for the news and the Government is due to publish further details shortly.
Gerry Fitzjohn, Board Chairman said:
“We would like to thank all the TPO agents that took part in the CMP survey we carried out last year as part of the Government’s CMP review. TPO’s survey ensured the industry had a voice during the review. While the survey results confirmed that a number of TPO agents already have CMP cover in place, we hope this news paves the way for the industry to finally have a level playing field so every consumer can be assured that their agent has CMP cover in place."
Gerry added: “If you do not have CMP cover in place, now is the time to review your options. Agents can contact their trade bodies to find out what cover they can provide and Lonsdale was one of the first insurance brokers to offer CMP cover to agents that do not belong to a trade body, which has developed an exclusive product for TPO agents.”
What does this news mean for agents?
The Government launched the CMP working group last autumn and this week’s report recommended that CMP becomes mandatory for letting agents in England that handle client money.
It’s important that agents take note of the existing legislation that already makes it a legal requirement for agents to disclose whether or not they have CMP cover.If you do not have CMP cover in place, now is the time to review your options (see below).
Current legislation requires letting agents to display whether they have CMP or not. Trading Standards officers have enforcement powers and can fine agents a civil penalty of up to £5,000 (payable to the council) for each office where the information is not published. There will also be a fine of up to £5,000 if the information is not published on an agent’s website.
How can I find out more about CMP cover?
CMP cover is available through a number of providers - agents can access cover through their trade association or Lonsdale, which was one of the first insurance brokers to offer CMP cover to agents that do not belong to a trade body.TPO has an exclusive agreement with Lonsdale, which offers TPO members comprehensive Professional Indemnity Insurance and Client Money Protection. Further information on the PI + CMP scheme can be found by clicking here.
Next steps: A checklist for agents
• Check your office and website: are you displaying your CMP cover?
• Disclose your CMP cover: the more you talk about CMP, the more informed landlords and tenants will become so they can scrutinise rival agents that have yet to sign up and are failing to protect client funds.
• Brief colleagues and clients: If a consumer asks, does everyone in your team know if your business has CMP cover? Please make sure your staff are aware that CMP goes beyond deposit protection – it offers additional safeguards and gives landlords with the peace of mind that the rent collected by their agent is protected from fraud and unlawful use.
• Research the CMP providers identified above and please look out for future updates concerning mandatory CMP cover.
To view the Government’s CMP report, please click here.
The Property Ombudsman has congratulated TPO agents in Swansea and Dorset for achieving 99% in a recent audit as part of a national campaign to make agents more aware of the law concerning letting fees.
During phase one of the campaign, 266 TPO letting agents across Swansea and Dorset were asked to provide photographic evidence to demonstrate how they complied with the law by displaying their fees in their branches and on their company websites. Any agents found to be incorrectly displaying their fees were then given the opportunity to amend and re-submit.
Katrine Sporle, Property Ombudsman, said:
“MASSIVE congratulations are owed to all the TPO agents operating in Swansea and Dorset for their fantastic audit results. They are leading the way for the country as a whole. The baton is now being passed to agents in Reading and Basingstoke and we look forward to seeing more great examples of firms that are meeting the requirements of the law by providing clear and transparent fees so consumers understand the commitments they are entering into."
Letting agents in Reading and Basingstoke will be targeted in a new phase of the campaign, which was announced this week following the success of the first phase. The first wave of letters have already been issued and every member agent will be contacted during the course of March and early April.
Katrine added: "The whole purpose of this campaign is to systematically support our members and help them prove that they can be brilliant. We want to educate and inform agents about the legal requirements they face."
TPO’s joint campaign with the Chartered Trading Standards Institute (CTSI) was announced in 2015, and despite the government subsequently announcing plans to ban agents from charging tenants upfront lettings fees, a period of consultation to draft and pass new regulations is yet to commence. In the meantime, the obligations on English and Welsh letting agents to display fees – along with redress and Client Money Protection (CMP)* scheme membership details – remain.
Furthermore, any future ban of tenant fees will not prevent letting agents from charging fees to landlords. Therefore, TPO and CTSI’s joint campaign to ensure agents display their fees in accordance with the law will continue.
Leon Livermore, Chartered Trading Standards Institute chief executive said:
“We are extremely pleased by the response to the campaign. It clearly demonstrates that TPO agents are aware of their responsibilities, willing to make improvements where necessary and committed to the highest levels of consumer protection.”
Just two agents failed to comply with the audit in Dorset and Swansea (by either not responding or not addressing flagged inaccuracies), and will now be referred to the scheme’s Disciplinary & Standards Committee (DSC) for further investigation. The DSC is independent to the industry and has the powers to fine, suspend or expel an agent from TPO, as well as refer them to Trading Standards Officers, who can impose fines of up to £5,000.
Property Industry Eye recently reporting a case where the Trading Standards department in Milton Keynes issued collective fines of £36,000 following an audit of over 100 offices. Read the full story here to find out more.
To view the full press announcement, please visit the news page of the TPO website.
Propertymark has invited the Property Ombudsman to host a series workshops across the UK over the coming months, which are listed below.
The news follows Propertymark’s recent Cardiff Masterclass where Katrine Sporle, Property Ombudsman, delivered a workshop for sales agents.
The Ombudsman will host a further eight workshops during 2017, which will include several real-life consumer case studies to highlight the role of the Ombudsman to raise standards in the industry, while also giving agents a chance to interact with each other and learn more about the UK’s largest property redress scheme.
The events will also include tailored sessions for sales and letting agents, with industry experts delivering inspiring talks and training seminars.
TPO member agents are welcome to attend any of the events listed below. Places are limited - please click the web links at the end of this article to view the agenda and guest speakers for each event (some events are listed on the ARLA and NAEA websites under the heading, ‘Save the date’ but full event programmes will be published in the build up to each event).
The Masterclass events that will include TPO workshops are listed below:
ARLA MASTERCLASSES (Lettings)
• 6th July, London
• 14th September, Berks/Oxon
• 28th September, West London
• 3rd October, West Midlands
NAEA MASTERCLASSES (Sales)
• 19th June, Central London
• 17th October, Northern Ireland
• 7th December, Bristol
Please note: The Masterclass in Hampshire, that had been scheduled to take place on Friday 7th April has now been postponed. We will share further news once Propertymark has confirmed a new date.
The full 2017 calendar of Propertymark Masterclasses is available to view on the events pages of the NAEA and ARLA websites listed below:NAEA Sales events (Masterclasses and Regional Conferences)
ARLA Lettings events (Regional Conferences)
We hope you can join us!
Consumer campaign names TPO as the only property organisation that operates approved Codes with enhanced consumer safeguards
The Consumer Code Approval Scheme (CCAS) launched a national awareness campaign this month to help more consumers find reputable and trusted businesses and services.
Consumers are being urged to check if their trader is on the Consumer Code Approval Scheme’s (CCAS) Approved Code Directory to ensure they only deal with firms following an accredited Code of Practice.
The CCAS has approved 24 Codes that collectively protect over £51billion in consumer spending. The Approved Code Directory has over 43,000 approved code members, which are responsible for more than 27million transactions.
TPO is the only property organisation to have its own Codes approved by CCAS, having received its first CCAS accreditation in 2005. TPO joined forces with a range of organisations in healthcare, retail, manufacturing, automotive, legal, energy, construction and financial services that have all pledged their continued commitment to raise industry standards by operating CCAS-approved Codes.
What does this news mean for agents?
Explaining the news, Gerry Fitzjohn, TPO’s Board Chairman, said: “TPO has been supportive of the Consumer Codes Approval Scheme since it was first launched by Office of Fair Trading many years ago. This is because the codes approved by the CCAS not only set out the minimum legal requirements, but place additional obligations on businesses to provide a higher standard of service to consumers. Businesses that sign up to these codes can proudly display their CTSI CCAS logo, demonstrating their commitment to expert service and underlining the enhanced consumer protection available to their clients.”
Gerry added: “Over 95% of UK sales agents and 85% of UK letting agents have voluntarily agreed to follow TPO’s approved Sales and Lettings Codes. All of these agents are listed on CTSI’s Approved Code Directory as well as the TPO website, and the sheer number demonstrates the value placed in TPO’s approved codes by the property sector. This can only be a good thing for consumers and the industry alike and I would encourage all approved businesses to explain these important benefits to their clients.”
Any TPO member agent following the scheme’s Sales or Lettings Code can proudly refer to itself as an approved code member.Approved code members have the right to display the trusted CTSI approved Code logo in their branch windows and on their websites. Branch stickers are available to order here.
Take action! Every TPO agent should use their membership as an opportunity to assure consumers that they follow an accredited Code of Practice, which requires agents to operate to the highest industry standards. We’ve provided some examples of how you can explain the value of your membership to consumers below:
• TPO Codes of Practice give consumers complete peace of mind that should an issue arise that they are unable to resolve with their agent, they can raise a complaint with TPO
• TPO’s free, fair and impartial dispute resolution service is a genuine alternative to the small claims courts
• TPO is the only property organisation to have its own Codes of Practice approved by the Consumer Code Approval Scheme (CCAS), which go above and beyond the law to protect consumers
• TPO is not a regulator but the Ombudsman’s powers mean that a member agent can be held to account for their actions, thanks to the scheme’s CCAS-approved Codes of Practice. Every complaint is different but the way the Ombudsman reviews them is exactly the same
• The Codes of Practice are crucial when reviewing complaints as they underpin the way each case is investigated to ensure a consistent and fair approach for all parties. The consumer and agent are signposted to the exact section(s) of the Code so there is complete transparency about how each case is reviewed to achieve a fair outcome
Agents beware! The CCAS was launched by CTSI in 2013 as part of a wider government review of consumer legislation and replaced a scheme operated by the defunct Office of Fair Trading. It is now illegal for agents to display the OFT logo in their marketing material and/or branch windows. TPO’s stationary order form provides a complete overview of the correct literature that agents can use to promote their membership.
New CTSI Brand Guide! The CTSI Logo is subject to specific conditions – please make sure you have read CTSI’s new Brand Guide, which was published last month and replaces all previous guidance.
We’ve published a quick guide for agents to ensure they are correctly displaying their membership, which you can view here.
TPO Governance: An interview with Gillian Fleming
What is the DSC? The Ombudsman refers cases to the DSC in the event of a serious breach of the Codes of Practice or where a firm fails to pay an award. Other referrals can come from TPO’s Membership Compliance Unit or, sometimes, from the media, regulators and professional bodies.
What does your role involve? As Chair of the DSC, I help maintain confidence in the property profession and in the Ombudsman. Surveys tell us the industry doesn’t have a great reputation. The actions of sales and letting agents are currently under the spotlight and subject to greater political and public scrutiny. Consumers and agents need to know that, when an agent acts unfairly and does not put it right, there may be action against them.
What attracted you to the role? I’ve spent the past 25 years in a variety of senior roles responsible for resolving disputes against a wide range of public and private sector organisations.
I began my career in Citizens Advice, before working for the Local Government Ombudsman and within the NHS. More recently I was a Non-executive director of a Foundation Trust Hospital responsible for good service provision. My time as a lead Ombudsman with Ombudsman Services enabled me see the issues faced by consumers and property professionals first hand. And I have a good deal of regulatory experience.
That broad base of experience meant that when I saw the role advertised, as clichéd as it may sound, I felt I could offer something useful.
What kinds of cases are you seeing? Firstly, we see relatively few. But they are mainly lettings cases and, while many letting agents have been following TPO’s Codes voluntarily for years, mandatory redress was only required a few years ago. So some agents might be unfamiliar with the Ombudsman powers and process - and the consequences of not addressing a dispute and complying with the scheme’s Codes.
There are some agents who seem to think a complaint might ‘go away’ even when a case is referred to TPO and take no part in the investigation. That is simply not the case. Not replying to the Ombudsman will not prevent the investigation being concluded. In fact, in many instances, this leaves the Ombudsman little choice but to proceed on the information provided by the consumer. Should the Ombudsman then decide the agent has acted unfairly, the agent will be instructed to pay a suitable award. Failing to pay the award means the case has to be referred to the DSC and we have the powers to recommend that TPO expel or suspend a firm.
Nor will leaving membership of the scheme make the issue go away: the three approved redress schemes have agreed an agent cannot join another redress scheme when there is an award outstanding. Sales and letting agents are legally obliged to be registered with an approved redress scheme. If a firm is expelled for failing to pay an award, they are reported to Trading Standards and if found to be trading illegally the firm risks having to pay a fine of up to £5,000.
What advice would you offer agents? Do make sure you engage with the Ombudsman and make sure you have your say. Let the Ombudsman know if you need a bit more time to get together your information – and do keep written records of all your calls, emails, client instructions and actions. The Ombudsman process is designed to get the best information for making a fair decision.
And agents should be proud of their TPO membership – following the scheme’s Codes shows your commitment to doing a good job and offering the best service standards. The Codes provide transparency for agents and consumers, setting out clearly the complex requirements facing agents, and are a bench mark for service delivery. And the DSC scheme is there to ensure standards amongst members are maintained.
Gillian Fleming was appointed Chair of TPO’s Disciplinary & Standards Committee (DSC) on 1 November 2016.
More information about the DSC can be found below: