As members of UKALA we get regular updates and news stories from England and across Wales. One story that is shown below highlights the danger of trusting an agent to manage your property and income without first finding out the answers to the following questions.
The news that broke on one of our regular news feeds tells the story of a letting agency director that stole hundreds of thousands of pounds from his customers, spending the money on holidays and shopping.
Clifford Wheatcroft, the former owner and director of Real-Est8 Property Solutions, used the cash to fund a "lavish lifestyle", investigators say. The 33-year-old has now been sentenced to 17 months in prison suspended for two years after admitting eight counts of theft.
Real-Est8 launched in 2009. It was based in Wimborne Road, Moordown in Bournemouth
The company was responsible for offering a 'middleman' service to landlords, which included finding tenants and collecting deposits and rent.
Tenants' money was then in turn meant to be passed onto the landlords. The landlords were charged a fixed fee of £50 per month per property for the service.
In December 2013, Wheatcroft, who owns a detached house in Sidney Gardens, Muscliff, was declared bankrupt. It was discovered that he had not placed the tenants' deposits in the secure government tenancy deposit protection scheme.
Several landlords also found that they were owed several months'-worth of rent.
When Wheatcroft was interviewed by police, he told officers he first got into financial difficulty during 2012. Things got worse in 2013 when Wheatcroft lost a big client, he said.
He then started to use the deposits and rents to keep up with other payments.
Financial enquiries showed Wheatcroft spent a considerable amount of money from the company account on personal items including holidays, leisure activities, shopping and meals out to the tune of £357,260.08.
In December 2013, the Daily Echo reported that tenants, landlords and maintenance men were left out of pocket after the closure.
If you or anyone you know has property(s) managed by a letting agent, you should get clarification on whether Client Money Protection Insurance is in place. If it is not, then we strongly recommend that the management is transferred to a more secure agent.
Client money protection insurance will give landlords peace of mind that in the event of an act of fraud or financial trouble with your letting agent you will have the facility to make a claim through the insurance in place.
We at Fresh have this insurance in place and have done so since we were formed. We are also members of UKALA. However, we suspect some agents in Swansea today still operate without the CMP insurance in place and this puts their rental income at risk.
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