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A sorry looking situation. We would recommend using escrow accounts for all payments to sourcing agents - whether its a sourcing fee, project management fee, payment to the builder or payment for furniture, the solution is to operate this via an escrow account, where monies only get released when goods and services have been supplied. There is very little in the property world that genuinely needs to be paid for in advance - even "builders materials" are often paid for on account and in arrears by the builder.
The use of escrow accounts would go a long way to stopping the type of issues we hear about in these threads. Good shout there.
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
We have a client account we use for our deposits and an agreement in writing.
A client account is not an escrow account.
We have built our own ring-fenced and insurance backed escrow system Vanessa. The days of "builder has run off with my money" hopefully coming to an end. In these days of decent financial technology there should be no reason for investors to be so exposed.
(*Moderator note: Post removed at request of original poster*).
well done and good for you for following through with this and hopefully getting justice for yourself and other victims.
1) Parting away with cash upfront seems to be the common theme in most of these accounts - finding ways to stop this (escrow account suggestion) is a good solution, perhaps there are others, rev-share model? I don't see why a genuine and decent service provider wouldn't sign up for one of such model and stand by their service.
2) This site has to be the default place for investors to check prior to investing (I am trying to make a habit of this), these other FB groups mentioned above, are victims also coming forward and posting their experiences and exposing such charlatans? What can one do more to expose them? What can an investor to improve their due diligence (is there a checklist)?
Yes, we have check-lists of how to undertake due diligence:How to use Companies House for due diligence Mitigating business risk via due diligence5 minute due diligence regime to research companies and deal sourcers As well as undertaking DD on the individual, you should also undertake DD on the strategy. It may not be viable at all in reality, or it may not be suited to your financial circumstances.
I paid Jason Cunningham £1750 total in fees to source a property. On the day I was supposed to sign, the letting agent said that he never knew it was for serviced accommodation and refused to allow it.I asked for my money back from Jason and within 14 days I received a court order from Jason for defamation, harassment and libel. Situation is still ongoing.
Apparently Jason Cunningham has today been EXPELLED from the PRS (Property Redress Scheme) he had an adjudication against him requiring him to refund a client and told the PRS he had no intention of paying.
Source: Serviced Accommodation Network UK FB Group.
Here's a FB post from earlier in the month - looks like the 27th day didn't go as well as his first 12 days!
June so far.... not bad for 12 days in ?