And ARCO and ARHM
ARMA has written to Communities Secretary James Brokenshire asking to be including on Lord Best’s working group looking at the regulation of estate agents, letting agents and block managing agents.
It almost certainly should be, in LKP’s view, as should we, representing the interests of leaseholders who pay for the sector.
ARMA tells Mr Brokenshire:
“ARMA has always been in favour of regulation and of raising standards …
“We believe that to ensure any proposed legislation is practical and proportionate across the entire property industry it is vital for the block property management sector to contribute by being a member of the working group.”
All of which is fair enough, and LKP would say that the group might benefit more from the presence of ARMA than it would from the Leasehold Advisory Service, which is not directly involved in property management.
The working group would also benefit from the presence of the Association of Retirement Community Operators and the Association of Retirement Housing Managers.
Of course, leaseholders should also be involved in this.
ARMA over-eggs the pudding a bit by adding: “ARMA would bring its experience of creating and running a Regulatory environment, establishing Codes and insight into the economics of the sector.”
The letter is co-signed by the CEOs of big managing agents who either get their business from developers or larger freehold owners, with the exception of the LKP-accredited HML Group plc, whose portfolio is made up leaseholder controlled blocks.
Warwick Estates co-signs the letter, which is curious as it demonstrated how not to behave in a regulatory regime: by resigning from RICS over a professional conduct ruling over management failings that had resulted in death, an earlier a criminal conviction and £120,000 fine.
ARMA regulator Sally Keeble quit ‘after being blocked’ from ruling on Warwick Estates lift shaft fatality
It also threatened to leave ARMA if its regulator, Labour ex-minister Sally Keeble held a similar inquiry. She quite rightly resigned as ARMA’s regulator, leaving the organisation’s efforts at self-regulation in tatters.
The other co-signees – FirstPort, Rendall and Rittner, Mainstay, RMG – are the standard issue larger managing agents, which set the ethos of ARMA and who can be relied upon to champion the status quo in leasehold, as well as speak up for the commercial interests of their freeholder employers.
None, for example, are going to worry about a freehold – that is, a slice of ordinary families’ homes – being owned by a murky offshore entity where the ultimate ownership is hidden. Indeed, Vincent Tchenguiz’s Tchenguiz Family Trust, based in the British Virgin Islands, remains FirtPort’s biggest employer (as well as being its former owner). Still, at least the beneficial interest is known.
Not one of these large property management companies is big because of leaseholder choice.
It is ironical that LKP is championing ARMA’s involvement, which is always invited to LKP / APPG’s parliamentary meetings, as it goes out of its way to bar us from its own.
The subject of LKP being snubbed by ARMA over its annual conference this year, exasperated Sir Peter Bottomley in correspondence with CEO Nigel Glen.
Nonetheless, it should be contributing to Lord Best’s work, and so should LKP.
It is obvious that LKP should be on the Working Group, as they are the only organisation that truly represents Leaseholders interests.
Not so sure about FirstPort. They have never compensated their own resident leaseholders for the Price Fixing Scandal operated by their forerunner Peverel.
And neither the ARMA or ARHM the Trade Organisations who willingly accept FirstPort as full members
According to the Firstport submission to the Law Commission report:
“We acknowledge that our own business has in the distant past been guilty of some of the poor practices that have affected consumer confidence in property management agents”
Some of those poor practices involved the price fixing scandal for which the current management have still failed to repay the victims of the price fixing.
And what of the “old management?
They are currently directors of Freemont Property Managers and deemed fit to be associate members of ARMA
ARMA pleads to be on Lord Best’s regulatory working group.
Lord Best’s working group looking at the regulation of estate agents, letting agents and block managing agents.
Certainly LKP should be representing the interests of leaseholders as they are the Premium Helper of Leasehold in the sector, not ARMA or LEASE. Not until a root and branch investigation has been undertaken to show how much damage has been caused by these organisations who have been seen to favour Freehold/Landlords above us Retirement Leaseholders who have been a poor third in the Leasehold Derby.
What cheek for the very company ARMA that accepted Firstport as a full member after the Price Fixing/Tender Rigging.
ARMA told Mr Brokenshire:- They believe that to ensure any proposed legislation is practical and proportionate across the entire property industry it is vital for the block property management sector to contribute by being a member of the working group, the letter is co-signed by the CEOs of big Managing Agents.
Not without major surgery to the organisation who failed to admonish Firstport over Price Fixing and the Sale of House Managers Flats. or LEASE who set up seminars to benefit Freeholders & Landlords informing them how to extrapolate monies from Leaseholders through Excessive Commissions and other Scams. LKP may say that ARMAs presence rather than LEASE but neither should be allowed at this juncture.
It seems that the knowelagble leaseholders directly effected in Retirement Developments are not required, yet have so much to add unlike the other organisations. Its like a patient not been involved when unwell and the staff carryout an investigation with knowing how you are feeling unwell.
Not just the price fixing scandal? What about the sale of residential house managers flats?
Remember the case of Alex Ellison at Mere Court?
Was it not Peverel/Firstport that failed to disclose commissions being offered to staff on completion of the sale of a residential house manager’s flat?
Was it not Peverel/Firstport that failed to disclose their financial interest in the flat, by misleading residents as to the owner of the flat by giving the name of the freeholder but not the leaseholder?
We need to get LKP on the working group.
If we do not have an effective service charges regime, existing leaseholders will continue to suffer wealth erosion and mental health issues.
You have a sinking fund and it sinks! Nothing you can do if the money has been taken out by the landlord or landlord-appointed managing agent.
At present the “protections” offered to service charge development funds are extremely limited.
Yes they must be held in separate accounts and cannot be used by a managing agent for their own use.
Unless insurance is taken out to cover against fraud or other loss the only protection is from the bank agreeing that in the event of a default of a managing agent leading to money being owed to the bank readily identifiable service charge funds will not be used to defray debts owing.
In the case of managing agents that maintain service charge development accounts themselves any errors are not the responsibility of the bank either?
It is not commonly known that though a resident see a bank statement headed up by RBS/Barclays etc, that statement has not been produced by the bank but is produced by the managing agent.
Similarly, the same situation applies to utility bills such as EDF/EON. the billing process is sub-contracted to outside companies.
At present service charge funds do not to have compulsory insurance to protect against loss.
ARMA have suggested insurance should be mandatory and have just launched an insurance scheme via NFU(no doubt a profitable enterprise for ARMA?)
Much has been spoken of the Peverel/Firstport price fixing scandal which was a fraud conducted against elderly and vulnerable leaseholders and was thought to have netted Peverel/Firstport £1,400,000 and for which despite the guilty plea less than £100,000 has been repaid.
So given it was fraud, given the service charge funds suffered a loss why was a claim never made against insurance if service charge funds have the “claimed” protection.
And if and when Firstport apply for service charge fund insurance protection do they declare the price fixing scandal on the insurance proposal form? And if they don’t would this invalidate any subsequent claim?