Top five landlord fines to watch out for
As lettings legislation has continued to tighten, so the penalties imposed on landlords and agents has increased. A local authority can now fine a landlord up to £30,000 per breach, enter their details on the national ‘rogues database’ and impose a banning order, preventing the landlord from managing a property or earning income from letting, potentially indefinitely. In the case of more serious breaches of the law – which usually involve fire safety violations in House in Multiple Occupations - criminal prosecution is likely, which could result in much higher fines and a prison sentence.
Here are five of the biggest fines that were imposed in 2018 alone:
July: House in Multiple Occupation landlord, £405,000
Believed to be one of the biggest ever financial penalties handed out to an individual landlord, Bijan Keshmiri from Lincoln was fined £405,000 for leaving 12 tenants living in what a magistrate called “appalling conditions” in two properties. He was convicted of 28 charges, including: broken smoke detectors, a lack of fire separation and protection between flats, poorly-made repairs that could increase the risk of fire spreading, fire exit doors being sealed shut, no emergency lighting in communal areas or stairwells and standard lighting not working across staircases and landings.
May: House in Multiple Occupation landlord, £371,250
Yunus Oomerjee, a landlord from Slough, was fined £371,250 after illegally extending a bungalow in Harrow to provide seven ‘shoddily-built’ self-contained units and a studio. He had repeatedly ignored warnings from the council and enforcement orders issued against the property over the lack of building regulation, fire safety and electrical checks.
He was ordered to pay £355,000 in confiscation proceedings to account for the money he made letting out the dwelling, plus £15,000 in costs and a £1,250 fine.
July: House in Multiple Occupation landlord, over £325,000
After years of ignoring orders to comply with planning regulations, Vispasp Sarkari was finally prosecuted under the Proceeds of Crime Act. In a joint action, Brent and Harrow councils proved that Mr Sakari had repeatedly bought run-down terraced and semi-detached houses and converted them into flats and studios without planning permission. He was ordered by a judge at Harrow Crown Court to pay a fine of £7,515 for planning breaches, £303,000 based on rent collected from tenants since 2005, plus legal costs of more than £18,000.
The court ruled that if the fine was not paid within six months, Mr Sarkari – who has also been convicted of breaching fire regulations at another property and served jail time for credit card fraud - would be jailed for three and a half years.
September: House in Multiple Occupation landlord, £177,000
After ignoring repeated warnings from his local council, Philip Brotherton of Reading, Berkshire, was fined £177,000 for serious breaches of fire safety regulations in his House in Multiple Occupation that put the lives of his tenants at risk, including: no working smoke alarms, an insufficient number of fire doors and an external escape route in a poor state of repair.
September: Managing agent, £53,620 and more this year
London agent, Sterling De Vere, was fined £46,620 and ordered to pay costs of £7,000 for committing five offences under the Housing Act 2004. The owner of the property had entered into a guaranteed rent arrangement with SDV, who then converted the three-bedroom house into a five-bedroom House in Multiple Occupation. When it was inspected by the council, they found numerous breaches, including: no licence, too many occupiers for the facilities, inadequate fire precautions, a leaking and malfunctioning boiler and that the tenant’s requests to have repairs made had been ignored.
SDV has also been ordered to pay a £167,000 fine and compensation of £740 to a renter for a misleading room advertising scam. In this case, the prospective tenant was shown a room in excellent condition, for which he paid a deposit, before being told it was no longer available and offered one of a much lower standard, with mould, bad fittings and a broken window.
Letting laws and enforcement are changing all the time, so it’s vital you understand your legal responsibilities and are aware of the penalties you could face, or if we manage your properties, we can deal with this for you.
Please do get in touch with your local Reeds Rains branch if you have any queries or concerns.