A watchdog that won't bark? ARLA criticised over letting agent collapse

Ajay Jagota, letting agent with KIS Lettings, has criticised ARLA over the controversial recent collapse of Charterhouse lettings. ARLA have, however, responded with a statement that they acted appropriately as soon as they were aware there was a problem.

Jagota said:  "It seems to me to be highly unlikely that no one noticed a thing, or that no one picked up the phone to ARLA to query the situation until the best part of £1m was at stake.

"ARLA must come clean about what they knew and when, how any audits of this firm missed its surely apparent shortcomings and weaknesses, and launch an immediate investigation into how this was allowed to happen.

"Why did their checks and balances fail so miserably on this occasion?

"Why were none of their much-vaunted sanctions and disciplinary measures ever imposed on this individual apart from the revoking of his membership a month after his business collapsed - a step I do not believe will have brought much comfort or consolation to the landlords who put their trust in an ARLA-regulated firm which has left them thousands of pounds out of pocket.  

"ARLA are clearly doing valuable work attempting to get Charterhouse's creditors their money back and I am completely supportive of any attempts to maintain and improve professional standards and build public trust in the rental sector, but frankly, what use is a watchdog which won't bark as landlords are left £750,000 out of pocket?"

ARLA defend procedures in wake of letting agent collapse

Ian Potter of ARLA refuted the accusations, saying: "The agent concerned was up to date with their accountants report and the figures contained in the last report were shown as being in balance. Until we became aware of the failure of the business there had been no reason for any investigation or disciplinary action. The eventual collapse of the business occurred quickly and we acted as soon as we were aware of the full depth of the problem.

"We are receiving claims from landlords and tenants for compensation under our Client Money Protection Scheme and all claims for compensation will be investigated fully and dealt with as appropriate. We do actively work with members where we are aware of issues and it's only thanks to their membership that this financial protection is in place should the worst happen."

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