Letting Agency Fined for Breaches of Consumer Rights Legislation
Professionals who deal directly with the public are subject to a battery of consumer protection rules and failing to comply with them can be costly, both in financial and reputational terms. In one case, a letting agency that neglected to display a list of its fees in a position where customers were likely to see it was hit with a £5,000 fine.
The penalty was imposed under the Consumer Rights Act 2015 by a local authority after a trading standards officer visited the agency's premises. A list of the agency's fees was displayed in the window, but was facing inwards, away from the street. The list was in any event non-compliant with the Act.
The agency was given an opportunity to amend and reposition the list but, when the officer visited again about a month later, it had been removed from the window. It was lying on a manager's desk, facing away from customers. The agency also did not have in place a notice stating that it was not a member of the Client Money Protection Scheme, which provides for payment of compensation to clients should an agent misappropriate their rent, deposits or other funds.
The local authority initially imposed two £5,000 monetary penalties, but subsequently conceded that it only had the power to impose one. In challenging the fine before the First-tier Tribunal (FTT), the agency argued that it was disproportionate and heavy-handed. It had cooperated with the officer and the list had only been removed from the window for about four hours so that it could be amended and retyped.
In dismissing the appeal, however, the FTT noted that the list's absence from the window was more than momentary and that it had in any event been non-compliant. Although £5,000 was the maximum penalty that could be imposed, there was no evidence that it would put the agency in financial difficulty. The fine would also encourage letting agents generally to be prompt in remedying breaches of the Act.