Client Money Protection is a mandatory requirement for all letting agents.
From 1 April 2019, all letting agents in England have been required to belong to a client money protection scheme when they are holding client money. This requirement is also in place in Wales as part of the Rent Smart Wales licensing conditions. This provides insurance to landlords and tenants in the event the agent misappropriates money from their clients.
What is client money protection?
At its most basic, the client money protection regulations require anyone engaging in property work to pay to belong to one of the recognised and approved client money protection schemes where they are holding client money.
This will insure any money paid by the landlord or tenant, so that if it is stolen by the agent, the landlord is covered.
What is client money?
Client money is any money received from a client (landlord or tenant) in the course of business that is held for another person. Rent for example is client money as the money is received in the course of business and held on behalf of the landlord. Similarly, a holding deposit or other charge would count as client money.
If a tenancy deposit is held by the agent in accordance with an insurance based deposit scheme, this money is not classed as client money and would not be protected.
Professional Properties is a member (020267) of UKALA (The UK Association of Letting Agents) which provides Total Loss Client Money Protection (CMP) which protects any money held by a letting agent. The scheme ensures that that money such as rents and deposits are safeguarded whilst in the custody of their agent and are returned to clients if anything should happen to the agent.
Click HERE to see our CMP Certificate
Click HERE to see our ‘Client Money Handling Procedures’