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With the introduction of mandatory client money protection from April 2019, Hamilton Fraser is announcing a joined up approach to its group companies; the Property Redress Scheme (PRS) and CMProtect (CMP).
With the mounting commercial pressures on letting agents, the partnership will deliver a more effective and convenient solution for client reassurance. In particular the 10,000 (and rising) members of the PRS will have access to preferential rates as well as a simplified membership process.
CMP, launched in 2014, is a membership scheme that focuses purely on protecting client money – an insurance service that until then was only available to agents that were members of an industry trade body.In the event that a letting agent becomes insolvent or cannot return the client money, the landlord or tenant contacts CMP and they deal directly with them, reimbursing their losses where appropriate. By being a member of CMP letting agents’ clients obtain this very important protection from an acknowledged expert in the private rental market.
CEO of Hamilton Fraser, Eddie Hooker said: “The Property Redress Scheme and CMProtect go hand in hand by giving consumers the reassurance that their relationship with their agent, whether financial or service wise is protected. Irrespective of what happens, the client’s money will be safe.A large proportion of the PRS membership do not have this important protection and subject to obtaining a government licence to operate a scheme we will ensure that all of our letting agent members across our group of companies fully comply with the forthcoming law. By using this group approach we can deliver the benefit at an even more affordable price. ”
As part of the partnership CMP are offering PRS members a special rate on CMP starting at £199 plus VAT (per annum) until 1st October 2018 compared to the normal rate of £299 for agents holding less than £100k of client’s money.
Client Money Protect, part of the Hamilton Fraser group of companies, has gained formal government approval to operate a client money protection scheme when the regulations go live on April 1st 2019. From April 1st, it will become mandatory for all letting agents and property managers in England to be a member of an approved client money protection scheme or face fines and sanctions for non-compliance.
Client Money Protect will offer a scheme that is fully compliant with the regulations and will feature no inner limits or annual aggregate claim caps meaning every customer of the agent is fully protected should the worse happen and every member of the scheme will have all their client money covered. Missing deposits that are not protected by an authorised tenancy deposit protection scheme will also be covered as will bank failure up to a certain level. The scheme will be aimed at small to medium sized operators that hold less than £5M client money and prices will start at £350.00 plus VAT.
Professional indemnity insurance, crime and directors and officers insurance can also be added to the membership thereby offering a complete package of protection for both the letting agent and their clients.
Membership of Client Money Protect is available immediately although it will not be mandatory to join the scheme until 1st April.
Eddie Hooker, CEO of Hamilton Fraser commented on the approval:
“After being fully involved in the consultation and shaping of the Client Money Protection legislation, we’re delighted with today’s approval.
As administrators of a CMP scheme since 2014, which enabled agents to join on a voluntary basis, we are proud to have been approved to continue providing CMP under the new legislation. We have worked hard to create a scheme that fully encapsulates the principle of what the government is trying to do by introducing mandatory client money protection. We want to be the gold standard of client money protection schemes.
In an increasingly regulated industry in which landlords are feeling the strain, this will offer some positive news in landlords’ and tenants’ favour. Tenants’ deposits will remain covered by the deposit protection schemes, but CMP will act as a backstop should there be an issue.”
Paul Shamplina, founder of Landlord Action and brand ambassador for Hamilton Fraser, added:
“Having dealt with too many cases where landlords and tenants have fallen victim to rogue letting agents who have misappropriated their money, I have long championed this move for our industry. However, the challenge of educating consumers to understand the importance of ensuring their agent holds CMP will continue, but hopefully this will raise awareness and standards.”
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**