Saturday, 23 August 2014

Sector backs plans to criminalise tenancy fraud

Plans to create a new criminal offence for people who commit tenancy fraud have been broadly welcomed by the sector.

A consultation on social housing fraud, published by the Communities and Local Government department in January, calls for subletting tenants to face two years in prison or a fine of up to £50,000.

The consultation closes today, and submissions from councils and housing associations indicate that the sector is behind tougher sanctions.

Mark Rogers, chief executive of Circle Group, said: ‘During our work to combat [tenancy fraud], we have seen some disturbing cases where the original tenant has made significant amounts of money while also depriving people in housing need of a home to call their own.

‘We hope that proposals to make this a criminal offence will make it clear that this is fraud which is a drain on communities and should not be tolerated.’

John Bryant, policy leader at the National Housing Federation, said: ‘We are broadly supportive of the proposals, but there are some problems with technical issues that need to be worked through.

‘We need to be careful that the availability of criminal sanctions doesn’t get in the way of existing civil remedies.’

A response from 20,000-home housing association Moat also supported the proposal, although it said the organisation does not anticipate ‘large numbers of prosecutions’ under a new offence.

Councils backed the introduction of a criminal offence of tenancy fraud, although some questions were raised about how often it would be used. A draft response from Tower Hamlets anticipates it would be ‘extremely rare’ for it seek a criminal prosecution, although it notes the stronger sanctions could act as a deterrent.

Wandsworth Council said it would have taken criminal action in around 40 per cent of tenancy fraud cases it has pursued over the past three years if the powers had been available. It suggested the ability to seek criminal prosecutions for tenancy fraud should be extended to housing associations.

Under the plans local authorities would be able to bring prosecutions for tenancy fraud. Housing associations would not have access to the same powers, due to concerns over the impact this would have on whether they are classified as private or public bodies, so would have to work with a local authority partner to instigate criminal proceedings.

The government will make a statement on the responses later this year.

Readers' comments (33)

  • I have trouble understanding this point that comes up about the difference between housing associations and councils.

    A couple of years back the high profile case of Weaver v. London & Quadrant ended with the courts deciding that housing associations are public bodies for the purposes of their housing management functions. Surely this sub-letting business comes under housing management functions.

    Is there a lawyer in the house?

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  • athair_siochain

    Two years in jail or a fifty thousand pound fine for subletting, now that stinks, the landlord is free to do what ever, they charge high rents, because there is no law to protect tenants I realise most of the government officials with power more than likely collect rent, I do know the Majority of politicians on all sides collect rent and interest.

    Where are all these people, that can thank a tenant who is subletting for a roof over their heads going to go, the fact is we have a Council that is creating a situation where a shortage of a place to stay, will give greedy landlords more incentive to charge higher rents,
    How can subletting be a fraud, when the real landlords are are the bedbugs of humanity, will be celebrating, and the question is where are all the students going to stay?

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  • So, who are we going to criminalise? The occupant who rented a cheap flat from someone advertising on Gumtree? The tenant who sub let? The bone idle management office who can’t be bothered to knock on the door from time to time to find out who is living in the property they manage? Why not criminalise private landlords who let properties in substantial disrepair or charge excessive rents? What about the failure of successive Governments to provide suitable appropriate accommodation at a fair and reasonable rent; that must be criminal.

    If you really want to make a change that will give people access to a home why not legalise squatting in properties that are registered as empty homes by local Councils? Remember that most empty homes are repossessed properties held by banks and building societies that are waiting for the market to pick up before they try and sell these assets.

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  • athair_siochain

    What will happen to people who have children teenagers who contribute to the familypurse,
    The landlords control most of our government institutions, how many landlords are on Wandworth Council? do most of them collect rent, if they do, then they should lower their heads in shame,

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  • The attacks on tenants has gone on relentlessly creating more and more criminal offences for them but none for the landlords abusing tenants in all sorts of ways.

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  • I am sorry but what are you all on??? This housing is all at least part funded by the tax payer so if someone gets a 'council house' and pays say £400pcm for a 2 bed property then lets it out in the PRS for say £700 pcm because they can live somewhere else this is wrong on so many levels, this housing is meant for vulnerable members of our sociaty not profiteers! I am areally sorry, i agree tenants get a raw deal and are being squezed but come on this is just wrong, it should be treated as fraud and those who do it should be jumped on from a very high hieght, it is NOT a victimless crime and just saying housing associations or councils are too lazy to chaise it up does not make it right. Rant over. (I also agree landlords need more regulation and tougher punishments if they do things wrong)

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  • Adam Farrands, you must look at the whole picture and at the fact that tenants of all type and kind are suffering and are going to suffer even more for their constant demonisation over many years... You say that subletting is not a victimless crime...
    then explain to me - or better to yourself - why a tenants are allowed to buy the properties they live in and sell them off to a profit? What is the difference with tenants subletting their properties for a profit?... Why am I allowed to buy and sell my tenancy and not to sublet it?... Can't you see that the wrong is in the government playing football with tenants for its own agenda?...

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  • Surely subletting should be a far less crime, if crime it is, than buying and selling your tenancy for a profit?... Why aren't they both made into crime?... And if they should not be crimes, surely the aspiration of some tenants to sublet can't be worse than that of some tenants to buy their properties for whatever use they will make of them, live in them or sell them off for a profit?

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  • And of course landlords love this because is yet another weapon in their hands to bash their tenants with if and when they wish to - because I suspect they will not use it against tenants they 'like'.

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  • I am a private landlord and can understand the arguement from both sides however tenants are always the first to have a pop at their landlords about sub quality properties etc. Lets put the shoe on the other foot, I look after my properties in my portfolio however we regularly have tenants damaging proiperties also taking the rent the council pays them for my rent and they spend it on alcohol etc leaving me out of poicket to pay the mortgate.

    Why not create a two way database of bad landlords so tenants can chose who they want to rent off, however also have an up to date database or unruly, untrustworthy, fruadulent tenants and create an even playing field for all parties - meaning tenants are looked after and also so are good landlords.

    A one strike and your out database.................

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  • tenantplus, i do not agree with selling off stock but at least the money can then be re-invested in more stock or inporving the conidion of the existing stock, if the property is sub-let this can not happen.
    I would suggest i am looking at the whole picture the difference is i do not believe that two wrongs make a right, i believe sub letting a social house at maket rent is wrong either in isolation or as part of the 'bigger picture'. I assume you were one of the first to odject to the 'affordable rents model' but here you are saying you agree with letting out social properties at market rent with no payback into the system that produced the properties or will build the next ones?

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  • I agree with you Adam, I cant see the other argument at all. Demand for social lettings is enormous. In the borough I work in London we have 1,400 social homes available through our ALMO and 17,000 on the waiting list who sit for ages in temporary accommodation waiting for a tenancy to come up.

    People then rent them out and walk with the profit. Private landlrods would and do, jump up in the air when they find their PRS tenant doing the same thing. And lets not forget that it isnt solely about the rental income. The rent book is often sold on. I remeber back in the 1990s the going price was £8,000 on the street.

    If government figures are to be believed (stop laughing at the back there) the problem costs £83 billion. More than enough revenue to end the crisis

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  • @ Ben Reeve-Lewis

    When RSL's / HA's appear at the trough with their snouts looking for freebie handouts of the UK Taxpayers cash as provided by the Government they are all too happy, to proclaim their public body status until such times it suits them to maintain they are not and are not subject to FOI requests, Human Rights laws etc . They get their cake and eat it as well !

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  • Yeah but thats a moral argument Stephen, still not the legal answer I seek

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  • Rob Smith | 04/04/2012 11:50 am

    I am a private landlord and can understand the arguement from both sides however tenants are always the first to have a pop at their landlords about sub quality properties etc. Lets put the shoe on the other foot, I look after my properties in my portfolio however we regularly have tenants damaging proiperties also taking the rent the council pays them for my rent and they spend it on alcohol etc leaving me out of poicket to pay the mortgate.

    Why not create a two way database of bad landlords so tenants can chose who they want to rent off, however also have an up to date database or unruly, untrustworthy, fruadulent tenants and create an even playing field for all parties - meaning tenants are looked after and also so are good landlords.

    A one strike and your out database.................

    =====

    And of course you would entirely agree with a database for landlords and one strike of the abusing tenants they will be banned from being landlords ever again.

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  • Adam Farrands | 04/04/2012 12:07 pm
    I am not suggesting anything. I am saying the government is playing football with tenants on every single issue, and in most cases encouraged to do so from their landlords... I am saying tenants are being criminalised on every single opportunity...
    Selling social housing stock to tenants has not guaranteed replacement of stock in any shape or form. You are talking entirely with your heads in the clouds. How many millions of social properties have been bought by tenants and how many of these have been replaced?... But I realise some people will never get what is going on.

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  • tenantplus, you seem very argumentative? Rob has suggested what many others have suggested and it is a very good idea. You are entirely correct in saying that the punishment for both should be the same but you will find that many tenants who abuse their tenancies still end up in another tenancy somewhere else. I do not think anyone would argue with the point that some people should not be landlords and there should be legislation in place to prevent them from letting properties. However as with tenants landlords also get themselves into trouble through naivety and even trying to help people but going about it in the wrong way, these landlords need support and guidance not just band from try to help other people find a home.

    As you your comment to me, you will see in my previous post that i do not agree with selling off stock. I would also like

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  • What a joke these posters are, a landlord comes post here that there should be a database for tenants who fail into something so that they would be either evicted or not re-housed again. This landlord does not for a moment think that the same thing should apply to bad landlords, and I am argumentative to remind him of that?... Mr Farrands spouts about the fact that subletting is wrong but right to buy is right, simply because the so called sales of rtb will replace social housing properties but does not know that 2 millions of social housing properties sold have not been replaced, and he call me argumentative for him talking rubbish?... What a fantastic method these posters have by telling tenants politely how worthless they are and they deserve to be... It never crosses the mind of these highly dignified posters that if you propose a crime for tenants you should do exactly the same for landlords or not propose it all.

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  • tenantplus, please re read my posts, i am agreeing with you that right to buy is not the best way forward yet you are still trying to argue that point, does that not make you arguementative? We will have to agree to disagree on sub letting as i am afraid i am obviously too 'highly dignified' or stuipid to be able to see this from your point of view. I also think if you bother to read back both Rob and myself have only suggested that the same rules and regs should apply to landlords and tenants, i am not sure how you are managing to argue with this point but well done for trying.

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  • Ps

    "The prime minister has formally unveiled the new right to buy scheme for social housing tenants in England which will include an increased discount cap of £75,000.


    The government is pledging that all homes sold under the reinvigorated right to buy will be replaced by a new home for affordable rent, with receipts from sales used towards the cost of the replacement."

    From a previous atrticle on this site, if you beleive it this will help provide more homes through right to buy (not sure i do to be fair)

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