Estate agency enforcement action

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Introduction

Under the Estate Agents Act 1979 (as amended), the OFT has the power to make an order banning a person from estate agency work if they have committed certain specified offences involving fraud, other dishonesty or violence, or have committed racial or sexual discrimination in the course of estate agency work, or have failed to comply with the requirements placed on estate agents by the Estate Agents Act 1979, and are unfit to carry on estate agency work. Alternatively, if such conduct occurred in the course of estate agency work, the OFT also has the power to issue a notice warning the person that the repetition of such conduct will result in them being banned.

OFT Adjudicators issue and determine prohibition and warning notices under the Estate Agents Act 1979, which advise the recipient of the notice that the OFT is considering taking action against him/her and the reason(s) why. They do so on behalf of the OFT but make independent decisions on a trader's fitness, based upon the contentions in a notice, the evidence attached to a notice and any representations made by those to whom the notices are addressed. After a notice has been issued and before an order is made, the person concerned has the right to make representations to the OFT as to why an order should not be made. Such representations may be made in writing and/or at an oral hearing.

If these representations are unsuccessful and an order is made, an appeal can be made to the First-tier Tribunal (Estate Agents), which forms part of the General Regulatory Chamber of the First-tier Tribunal. It is administered by the Tribunals Service, an agency of the Ministry of Justice.

It is a criminal offence to practice as an estate agent in contravention of a ban. It is punishable by a fine, either in the Magistrates' or Crown Court.

After an order has been made, the person affected can at any time, and on payment of a fee, currently £2500, apply to the OFT for the order to be varied or revoked.

Below is an outline of recent action undertaken by the OFT since 2012.

See further information about the legal obligations placed on estate agents under the Act.

See also our consultation on OFT guidance for estate agents-: compliance with the Consumer Protection from Unfair Trading Regulations 2008 and the Business Protection from Misleading Marketing Regulations 2008.

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Update 24 April 2013

• London-based estate agent fined
  
  On April 22 2013, the OFT imposed a penalty of £2,000 on Maxim Property Limited for carrying on estate agency business after 31 January 2010 without being registered with the OFT, a breach of Regulation 33 of the Money Laundering Regulations 2007. The company has 28 days to appeal.
• OFT bans Sandwell property agent Amerjit Singh Dhuga trading as WLI.uk.com from estate agency work (Order made 18 March 2013)
  
  The OFT has issued a prohibition order banning a Sandwell property agent from estate agency work as a result of his convictions, including his convictions for offences of fraud.
  
  Amerjit Singh Dhuga has been banned from carrying on estate agency work after he was prosecuted by Sandwell Trading Standards Service and convicted of multiple offences under the Consumer Protection from Unfair Trading Regulations 2008, the Business Protection from Misleading Marketing Regulations 2008 and the Fraud Act 2006 by the Warley Magistrates' Court on 21 January 2011.
  
  Following Mr. Dhuga's convictions, the OFT launched its own investigation under the Estate Agents Act 1979. The OFT determined that Mr. Dhuga is unfit to carry on estate agency work.
  
  Mike Coates, Assistant Director in the OFT's Goods and Consumer Group said
  
  'These were serious offences and a reminder to all estate agents that by engaging in acts of fraud or other dishonesty or by committing offences under the Consumer Protection from Unfair Trading Regulations 2008, they are likely to face a ban from the profession.
  
  'The OFT, working together with the Trading Standards Service, will continue to take tough action against estate agents who flout the law.'

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Update 12 March 2013

OFT fines Leeds-based estate agent

The OFT has fined Leeds-based Oliver James Estates and Land Agents Limited £2,000 for failing to register with the OFT.

All estate agents and some credit lending businesses need to register with the OFT as part of their responsibilities under the Money Laundering Regulations 2007.

Despite the OFT repeatedly contacting and advising Oliver James between November 2011 and February 2012 of the need to register, the business failed to do so.

Kate Pitt, OFT Deputy Director of Anti-Money Laundering, said: 'We will not hesitate to take action against any estate agents and lenders that fail to register with the OFT.'

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Update 24 January 2013

• OFT bans Croydon estate agent Alaba Adewale Adebajo from estate agency work
  
  (Order made 6 July 2012)
  
  The OFT has issued a prohibition order banning a Croydon estate agent from estate agency work. This was following the Financial Services Authority imposing a fine and prohibition order on Alaba Adewale Adebajo, at the time a director of Whitehouse Estate Agents and Financial Services Limited. Mr Adebajo submitted five false mortgage applications for himself and failed to keep adequate and accurate records. Accordingly he posed a risk to consumers and lenders and to confidence in the financial system. On the basis of the FSA's findings the OFT launched its own investigation under the Estate Agents Act 1979. It found that Mr Adebajo had committed offences of dishonesty and is therefore unfit to practise estate agency work. 
  
  Mike Coates, Assistant Director in the OFT's Goods and Consumer Group said
  
  'This was a serious offence and a reminder to all estate agents that by engaging in acts of fraud or other dishonesty they are likely to face a ban from the profession.
  
  'The OFT, working together with the Trading Standards Service, will continue to take tough action against estate agents who flout the law.'
  
• OFT bans Luton estate agent Nadeem Sultan from estate agency work
  
  (Order made 12 June 2012)
  
  The OFT has issued a prohibition order banning a Luton estate agent from estate agency work as a result of his criminal convictions.
  
  On 29 January 2010, Nadeem Sultan, the former managing director of Regency Estate and Lettings Agents Limited in Luton, was convicted at Southwark Crown Court of conspiracy to defraud and conspiracy to launder. Mr Sultan had used false documentation to persuade a loan company to lend £850,000 on a property in Chelsea. Mr Sultan was then involved in an attempt to obtain originally £1.2 million, then £750,000 fraudulently from the same loan company. Mr Sultan received concurrent sentences of six years' imprisonment for the offences.
  
  The OFT launched an investigation under the Estate Agents Act 1979 into Mr Sultan's fitness to carry on estate agency.
  
  In addition to his convictions in 2010, Mr Sultan was convicted at Luton Crown Court on 7 March 2007 of making a false oath or declaration with reference to marriage. In light of all of these convictions, the OFT found Mr Sultan unfit to carry on estate agency work.
  
  Mike Coates, Assistant Director in the OFT's Goods and Consumer Group said
  
  'These were serious offences and a reminder to all estate agents that by engaging in acts of fraud or other dishonesty they are likely to face a ban from the profession.
  
  'The OFT, working together with the Trading Standards Service, will continue to take tough action against estate agents who flout the law.'
  
  
• OFT bans Kevin Johnston of Belfast from estate agency work
  
  (Order made 29 March 2012)
  
  The OFT has issued a prohibition order banning a Belfast estate agent from estate agency work. The OFT has determined that Kevin Johnston, who operated House Property and Mortgage Advisers ('HPMA') in Belfast, is unfit to carry on estate agency work, owing to his failure to join a consumer redress scheme, and his failure to register with the OFT for anti-money laundering purposes.
  
  All estate agents engaging in residential sales are required by law to belong to an OFT approved consumer redress scheme. Moreover, estate agents and other businesses conducting estate agency work, in the UK, are required to register with the OFT, who is the supervisor for the purposes of the Money Laundering Regulations 2007 ('MLRs'). Mr Johnston, trading as HPMA, did not join a consumer redress scheme, leading to the Trading Standards Service of Northern Ireland imposing a £1000 Penalty Charge Notice for this failure. Nor did he register with the OFT for anti-money laundering purposes under the MLRs.
  
  Following the decision by Northern Ireland Trading Standards Service to impose a Penalty Charge Notice, the OFT launched its own investigation under the Estate Agents Act 1979 to determine whether Mr Johnston was fit to carry on estate agency. The OFT found that Mr Johnston, trading as HPMA, had failed to join a consumer redress scheme. The OFT also found that Mr Johnston, trading as HPMA, had failed to register his business for anti-money laundering purposes under the MLRs. In relation to the not registering his business for anti-money laundering purposes, the OFT imposed a penalty of £2,000 on Mr Johnston.
  
  The OFT determined that by reason of Mr Johnston's failure to belong to an OFT approved consumer redress scheme, and his failure to register for the purpose of the MLRs, he is unfit to carry on estate agency work.
  
  Mike Coates, Assistant Director in the OFT's Goods and Consumer Group said:
  
  'This is a reminder to all estate agents that by failing to join a redress scheme, and failing to register with the OFT for anti-money laundering purposes, they are likely to face a ban from the profession.
  
  'Home buyers have the right to know that the estate agents they are dealing with are trustworthy and follow the law. The OFT, working together with the Trading Standards Service, will continue to take tough action against estate agents who flout the law.'

 

• OFT bans North West London estate agent Selvavinayakam Vigneswaran from estate agency work
  
  (Order made 20 August 2012)
  
  The OFT has issued a prohibition order banning a North West London estate agent from estate agency work. This was following the Financial Services Authority ('FSA') concluding that Selvavinayakam Vigneswaran was not a fit and proper person to carry out any functions in relation to a number of activities regulated under the Financial Services and Markets Act 2000 ('FSMA'). The FSA withdrew the approval it had given to Mr Vigneswaran to perform a number of functions under FSMA and also imposed a financial penalty on Mr Vigneswaran. The FSA penalty was £250,000, representing £150,000 relating to the FSA's finding that Mr Vigneswaran had submitted fraudulent applications for regulated mortgage contracts and £100,000 relating to the FSA finding that Mr Vigneswaran had deliberately misled the FSA.
  
  Mr Vigneswaran was at the time of the events leading to the FSA action, a director of Man & Co Estate Agents in Kingsbury. The FSA made its orders, having found that Mr Vigneswaran submitted false information to mortgage lenders and thus posed a risk to consumers and lenders and to confidence in the financial system.
  
  Having been notified of the FSA's findings, the OFT launched its own investigation under the Estate Agents Act 1979. The OFT found, in light of Mr Vigneswaran's own admission to the FSA, that Mr Vigneswaran had committed offences of dishonesty. The OFT therefore determined that Mr Vigneswaran was unfit to carry on estate agency work and issued an prohibition order banning him from estate agency work.
  
  Mike Coates, Assistant Director in the OFT's Goods and Consumer Group said
  
  'This was a serious offence and a reminder to all estate agents that by engaging in acts of fraud or other dishonesty they are likely to face a ban from the profession.
  
  'The OFT, working together with the Trading Standards Service, will continue to take tough action against estate agents who flout the law.'
  
  
• OFT bans Manchester estate agent Keith Fryer from estate agency work
  
  (Order made 31 May 2012)
  
  The OFT has issued a prohibition order banning a Manchester estate agent from estate agency work. On 3 December 2010 and 21 June 2011 Mr Fryer was convicted at Bolton Crown Court of a number of offences of fraud and obtaining money by deception. In summary, Mr Fryer fraudulently obtained almost £40,000 from the management company set up for the housing development where he lived and of which he acted as treasurer. He forged invoices for gardening work and persuaded fellow residents to write blank cheques which he paid to himself, his wife and two companies he ran. Mr Fryer has at various times run Unity Investments Limited, Capital Funding and Equity Options Limited. Following his conviction the OFT launched its own investigation under the Estate Agents Act 1979 and determined that Keith Fryer was unfit to carry on estate agency work.
  
  Mike Coates, Assistant Director in the OFT's Goods and Consumer Group said
  
  'This was a serious offence and a reminder to all estate agents that by engaging in acts of fraud or other dishonesty they are likely to face a ban from the profession.
  
  'The OFT, working together with the Trading Standards Service, will continue to take tough action against estate agents who flout the law.'
  
  
• The OFT has fined Leicester-based IPS Estate Agents Limited £11,844 for failing to comply with anti-money laundering regulations.
  
  IPS failed to comply with a number of requirements under the Money Laundering Regulations 2007, including those relating to:
  
  - verifying the identity of customers
  - keeping appropriate records
  - ensuring that relevant staff are aware of the law relating to money laundering and terrorist financing
  - establishing and maintaining appropriate, risk-sensitive policies and procedures.
  
  The failures relate to the period between March 2010 and October 2011. The OFT visited IPS premises to check compliance with the Regulations in June 2011 and again in October 2011.
  
  Kate Pitt, OFT Deputy Director of Anti Money Laundering, said:
  
  'This fine sends out a message to all estate agents that they need to have appropriate measures in place to prevent their business from being used for money laundering or terrorist financing purposes.'

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Update 15 January 2013

• OFT bans Gerard Speed trading as Speed Property of Stirling from estate agency work (Order made 2 April 2012)
  
  The OFT has issued a prohibition order banning a Stirling estate agent from estate agency work. Gerard Speed trading as Speed Property has been banned from engaging in estate agency work owing to its failure to join a consumer redress scheme. The agent failed to join despite Stirling Trading Standards Service imposing a £1000 Penalty Charge Notice. All agents engaging in residential sales are required by law to belong to an OFT approved consumer redress scheme. The OFT subsequently launched its own investigation under the Estate Agents Act 1979 and found that Gerard Speed trading as Speed Property is unfit to practise estate agency work. 
  
  Mike Coates, Assistant Director in the OFT's Goods and Consumer Group said:
  
  'This is a reminder to all estate agents that by failing to join a redress scheme, they are likely to face a ban from the profession.
  
  'Home buyers have the right to know that the estate agents they are dealing with are trustworthy and observe the law, and we, working together with the Trading Standards Service, will continue to take tough action against estate agents who flout the law.'
• OFT bans John Shepherd trading as Grove Estates of Newport from estate agency work (Order made 1 June 2012)
  
  The OFT has issued a prohibition order banning a Newport estate agent from estate agency work. John Shepherd trading as Grove Estates has been banned from engaging in estate agency work owing to its failure to join a consumer redress scheme. The agent failed to join despite Newport Trading Standards Service imposing a £1000 Penalty Charge Notice. All agents engaging in residential sales are required by law to belong to an OFT approved consumer redress scheme. The OFT subsequently launched its own investigation under the Estate Agents Act 1979 and found that John Shepherd trading as Grove Estates is unfit to practise estate agency work.
  
  Mike Coates, Assistant Director in the OFT's Goods and Consumer Group said:
  
  'This is a reminder to all estate agents that by failing to join a redress scheme, they are likely to face a ban from the profession.
  
  'Home buyers have the right to know that the estate agents they are dealing with are trustworthy and observe the law, and we, working together with the Trading Standards Service, will continue to take tough action against estate agents who flout the law.'
• OFT bans Move Direct Limited of Southampton from estate agency work (Order made 11 Sept 2012)
  
  The OFT has issued a prohibition order banning a Southampton estate agent from estate agency work. Move Direct Limited has been banned from engaging in estate agency work owing to its failure to join a consumer redress scheme. The agent failed to join despite Southampton Trading Standards Service imposing a £1000 Penalty Charge Notice. All agents engaging in residential sales are required by law to belong to an OFT approved consumer redress scheme. The OFT subsequently launched its own investigation under the Estate Agents Act 1979 and found that Move Direct Limited is unfit to practise estate agency work. 
  
  Mike Coates, Assistant Director in the OFT's Goods and Consumer Group said:
  
  'This is a reminder to all estate agents that by failing to join a redress scheme, they are likely to face a ban from the profession.
  
  'Home buyers have the right to know that the estate agents they are dealing with are trustworthy and observe the law, and we, working together with the Trading Standards Service, will continue to take tough action against estate agents who flout the law.'

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Update 2 January 2013

OFT bans Sharon Price, formerly sole director of Price Property Rentals Limited, from estate agency work

The OFT has issued a prohibition order banning a Cambridgeshire estate agent from estate agency work.

Sharon Price has been banned from carrying on estate agency work after she was prosecuted by Cambridgeshire Trading Standards Service and convicted of offences under the Consumer Protection from Unfair Trading Regulations 2008 and the Business Protection from Misleading Marketing Regulations 2008 by the Huntingdon Magistrates Court on 7 June 2011. The magistrates also disqualified Ms Price from certain company roles, including being a company director, for five years, under the Company Directors Disqualification Act 1986.

Ms Price was the sole director of Price Property Rentals Limited, a lettings agency based in Huntingdon. The company failed to register tenants' deposits with an authorised deposit protection scheme as required by law. It failed to repay deposits to tenants when they moved out of properties. It also failed to pass on rent it received from tenants to landlords and it failed to repay deposits. Seventy-five claims were received by the National Association of Estate Agents from tenants and landlords, totalling approximately £144,000. Of these, the OFT understands that 45 have been settled with a total value of £94,000.

Following Ms Price's convictions, the OFT launched its own investigation under the Estate Agents Act 1979 and determined that Ms Price is unfit to carry on estate agency work. 

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Update 31 October 2012

The OFT has imposed an £8,866 fine on Essex-based estate agent Michael Adkins, trading as JB Property Services, for failing to comply with the Money Laundering Regulations 2007 (the Regulations). Despite being registered with the OFT for anti-money laundering (AML) purposes, the estate agent failed to verify the identity of its clients. The OFT considers such breaches of the Regulations make the business vulnerable to being used for money laundering and terrorist financing.

The estate agent has a right to appeal against the OFT's decision.

David Fisher, OFT Director of Credit and AML, said: 'This fine sends out a strong message that we will impose proportionate and dissuasive fines where we find evidence of serious non compliance with Money Laundering Regulations.'

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Update 27 June 2012

OFT bans Jatinder Kalar, formerly sole director of 'Let's Move Estates UK Limited', from estate agency work

The OFT has issued a prohibition order banning an Ilford estate agent from estate agency work. Jatinder Kalar has been banned from engaging in estate agency work after he was convicted on his own confession of inflicting grievous bodily harm at Snaresbrook Crown Court on 28 March 2011. Mr Kalar assaulted his former business partner who was showing clients around a property in Ilford. The OFT subsequently launched its own investigation under the Estate Agents Act 1979 and found that Mr Kalar is unfit to practise estate agency work.  

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Public Register

The OFT's Public Register, listing estate agents who have either been warned or banned, can be viewed at the Estate Agents Public Register.

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