• Menu
  • Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Before Header

  • Home
  • What is LKP
  • Find everything …
  • Contact
Donate

Leasehold Knowledge Management Logo

Secretariat of the All Party Parliamentary Group on leasehold reform

Mobile Menu

  • Home
  • What is LKP
  • Find everything …
  • Contact
  • Advice
  • News
    • Find everything …
    • About Peverel group
    • APPG
    • ARMA
    • Bellway
    • Benjamin Mire
    • Brixton Hill Court
    • Canary Riverside
    • Charter Quay
    • Chelsea Bridge Wharf
    • Cladding scandal
    • Competition and Markets Authority / OFT
    • Commonhold
    • Communities Select Committee
    • Conveyancing Association
    • Countrywide
    • MHCLG
    • E&J Capital Partners
    • Exit fees
    • FirstPort
    • Fleecehold
    • Forfeiture
    • FPRA
    • Gleeson Homes
    • Ground rent scandal
    • Hanover
    • House managers flat
    • House of Lords
    • Housing associations
    • Informal lease extension
    • Insurance
    • IRPM
    • JB Leitch
    • Jim Fitzpatrick MP
    • John Christodoulou
    • Justin Bates
    • Justin Madders MP
    • Law Commission
    • LEASE
    • Liam Spender
    • Local authority leasehold
    • London Assembly
    • Louie Burns
    • Martin Paine
    • McCarthy and Stone
    • Moskovitz / Gurvits
    • Mulberry Mews
    • National Leasehold Campaign
    • Oakland Court
    • Park Homes
    • Parliament
    • Persimmon
    • Peverel
    • Philip Rainey QC
    • Plantation Wharf
    • Press
    • Property tribunal
    • Prostitutes
    • Quadrangle House
    • Redrow
    • Retirement
    • Richard Davidoff
    • RICS
    • Right To Manage Federation
    • Roger Southam
    • Rooftop development
    • RTM
    • Sean Powell
    • SFO
    • Shared ownership
    • Sinclair Gardens Investments
    • Sir Ed Davey
    • Sir Peter Bottomley
    • St George’s Wharf
    • Subletting
    • Taylor Wimpey
    • Tchenguiz
    • Warwick Estates
    • West India Quay
    • William Waldorf Astor
    • Windrush Court
  • Parliament
  • Accreditation
  • [Custom]
Menu
  • Advice
  • News
      • Find everything …
      • About Peverel group
      • APPG
      • ARMA
      • Bellway
      • Benjamin Mire
      • Brixton Hill Court
      • Canary Riverside
      • Charter Quay
      • Chelsea Bridge Wharf
      • Cladding scandal
      • Competition and Markets Authority / OFT
      • Commonhold
      • Communities Select Committee
      • Conveyancing Association
      • Countrywide
      • MHCLG
      • E&J Capital Partners
      • Exit fees
      • FirstPort
      • Fleecehold
      • Forfeiture
      • FPRA
      • Gleeson Homes
      • Ground rent scandal
      • Hanover
      • House managers flat
      • House of Lords
      • Housing associations
      • Informal lease extension
      • Insurance
      • IRPM
      • JB Leitch
      • Jim Fitzpatrick MP
      • John Christodoulou
      • Justin Bates
      • Justin Madders MP
      • Law Commission
      • LEASE
      • Liam Spender
      • Local authority leasehold
      • London Assembly
      • Louie Burns
      • Martin Paine
      • McCarthy and Stone
      • Moskovitz / Gurvits
      • Mulberry Mews
      • National Leasehold Campaign
      • Oakland Court
      • Park Homes
      • Parliament
      • Persimmon
      • Peverel
      • Philip Rainey QC
      • Plantation Wharf
      • Press
      • Property tribunal
      • Prostitutes
      • Quadrangle House
      • Redrow
      • Retirement
      • Richard Davidoff
      • RICS
      • Right To Manage Federation
      • Roger Southam
      • Rooftop development
      • RTM
      • Sean Powell
      • SFO
      • Shared ownership
      • Sinclair Gardens Investments
      • Sir Ed Davey
      • Sir Peter Bottomley
      • St George’s Wharf
      • Subletting
      • Taylor Wimpey
      • Tchenguiz
      • Warwick Estates
      • West India Quay
      • William Waldorf Astor
      • Windrush Court
  • Parliament
  • Accreditation
You are here: Home / News / Insurance / Managing agents owned by landlords must come clean … says leading managing agent

Managing agents owned by landlords must come clean … says leading managing agent

June 20, 2012 //  by Sebastian O'Kelly

A managing agent owned by the freeholder should be made to disclose this relationship clearly to the leaseholders, one of the country’s leading managing agents has announced.

“They should be obliged to disclose if they have, or any party to whom they are financially connected has, any beneficial interest in the freehold title,” says Rob Plumb (left), chief executive of HML Holdings plc.

“Such a relationship clearly gives rise to doubts about their impartiality.”

Plumb’s comments appear in a letter in response to the London Assembly’s continuing investigation into leasehold service charges. In March it issued a report, Highly Charged, which was critical of “opaque” charges and claimed that leasehold complaints had increased by more than 50 per cent in ten years (more here)

The letter has also been forwarded to the Association of Residential Managing Agents and the Leasehold Knowledge Partnership. HML manages 35,000 residential properties.

Plumb argues in favour of regulating residential managing agents, and welcomes ARMA’s proposed “self-regulated system of accreditation which is more demanding of the standards of its members than hitherto has been the case”.

But Plumb urges legislative action to make the qualification of managing agents compulsory, through organisations such as the Institute of Residential Property Management.

“Having formerly operated within the strictures of the FSA in the financial services industry and practised in the auditing profession, the freedom with which managing agents are legally able to operate is an enigma to me.

“In particular, the freedom to unrestrictedly manage the bank accounts of clients without any specific control requirements seems extremely relaxed to me when compared with others who manage Trust funds …

“Ultimately accreditation of individuals or companies would need to be supported by a regulatory authority with the ability to sanction those who do not comply.”

Plumb then turned to landlords or managing agents employing their own companies to provide services leaseholders.

“We believe that the overwhelming majority of leaseholder concerns could be met by a simple, but mandatory disclosure requirement describing the nature of the participation. This should, of course, be accompanied by the leaseholders’ collective right to insist on a supplier other than the one the landlord wishes to use (so long as that supplier is equally independent).”

On the highly controversial issue of loaded insurance commissions (more here), Plumb makes an interesting distinction between the commissions earned by a landlord and those earned by managing agents.

Landlords make fortunes out of these loaded fees for insurance, with the exquisite get-out that leaseholders have no right to know of the commissions in a contract between landlord and insurer, even though they ultimately pay for it.

In contrast, Plumb believes commissions to managing agents who actually do something are justified.

“The landlord seldom spends any time or incurs any administration [in placing the insurance] … This is not the case for the managing agent whose role is more akin to a broker than it is to a “commission earner”.

“ … the managing agent is actually assisting a broker in providing part of the insurance service on behalf of the insurance company.  That service includes information gathering for underwriting, collection of the premiums and assistance with claims management.

“An insurance company can understandably see this assistance as work for which for which the managing agent should be reasonably remunerated for.

“Perhaps the residential managing agent community should stop calling this income “commission” (which implies commission for selling or introducing) and start referring to it as an “insurance administration fee”.”

Regarding the resolution of disputes, Plumb is lukewarm on the issue of mediation prior to application to the Leasehold Valuation Tribunal – which was advocated by LEASE, the Leasehold Advisory Service.

“We agree that there could be merit in creating a forum or process for mediation or arbitration aimed at cases of limited complexity and value … [but] This stage, i.e. pre-trial review, would be more equal and accessible if the parties were not permitted to employ counsel.”

Rob Plumb’s full submission to the London Assembly can be read here
HMLtoLondonAssembly

Related posts:

RTM facilitators issue 2 year ‘honeymoon’ contracts with favoured managing agents … without consulting ALL leaseholders Default ThumbnailBungs ‘r’ Us: £250,000 ‘incentive payments’ offered to managing agents Default ThumbnailHow to handle your leasehold ‘right to manage’ – by a leading managing agent Ombudsmen will help minor issues but are a ‘million miles’ from dealing with the complex legal acrimony in leasehold, says leading managing agent Default ThumbnailARMA-Q must expose managing agents’ ‘financial interests’

Category: Insurance, London Assembly, NewsTag: HML Anderton, London Assembly, Rob Plumb

Latest Tweets

Tweets by @LKPleasehold

Mentions

Anthony Essien (34) APPG (37) ARMA (87) Bellway (30) Benjamin Mire (32) Cladding scandal (71) Clive Betts MP (31) CMA (45) Commonhold (52) Competition and Markets Authority (41) Countryside Properties plc (33) FirstPort (42) Grenfell cladding (56) Ground rents (54) Harry Scoffin (150) James Brokenshire MP (31) Jim Fitzpatrick (35) Jim Fitzpatrick MP (30) Justin Bates (40) Justin Madders MP (67) Katie Kendrick (37) Law Commission (60) LEASE (66) Leasehold Advisory Service (62) Leasehold houses (32) Long Harbour (48) Martin Boyd (80) McCarthy and Stone (39) National Leasehold Campaign (38) Persimmon (49) Peverel (61) Property tribunal (49) Redrow (30) Retirement (37) Robert Jenrick (33) Roger Southam (47) Sajid Javid (38) Sebastian O’Kelly (55) Sir Peter Bottomley (201) Taylor Wimpey (106) Tchenguiz (33) The Guardian (33) The Times (31) Vincent Tchenguiz (43) Waking watch contracts (40)
Previous Post: « TV documentary on retirement industry needs help
Next Post: Janet Entwistle: ‘There are problems with Peverel’s reputation, but new owners are in it for the long term’ »

Reader Interactions

Comments

  1. Lesley Newnham

    June 21, 2012 at 1:14 pm

    I for one would love to know if our so called EX managing agent has any financial connection or benefit to the freehold title as having exercised our Right to Manage they are far from being EX but instead still have a huge say in too many issues for my liking!!

    • Marguerite Hatcher

      June 21, 2012 at 10:54 pm

      I concurr, we are of the same opinion with our leaseholds-complaints are never sorted and scams abound -they just rip you off at every opportunity!

  2. Marguerite Hatcher

    June 21, 2012 at 10:48 pm

    Leasehold property is at an all time high for builders and their Managing Agents to scam and rip off all Citizens that buy a leasehold-will someone please regulate the con merchants in this business-it has to stop !

  3. Marguerite Hatcher

    June 21, 2012 at 10:51 pm

    The Management company and Freeholders are in this together-a leaseholder doesn’t stand a chance against this corruption

  4. Mark lingard

    June 22, 2012 at 6:59 pm

    “Managing agents owned by landlords must come clean … says leading managing agent” Absolutely but in my case I am informed that not only does the above apply but also they own the company that built the complex and also the company that sold them the land. This incestuous relationship serves only one purpose, to make money.

  5. Florrie

    June 25, 2012 at 9:46 pm

    I agree it does need to stop. The 1st thing to do is sign the petition that has been set up and hopefully if there are enough of us that do then we can hopefully get it heard in parliament.

  6. Camden letting agents

    June 28, 2012 at 8:05 am

    I hope all landlords can come clean! Anyway this article is really great !

Above Footer

Advising leaseholders. Avoiding disasters.
Stopping forfeiture. Exposing abuses. Urging reform.

We depend on individuals for the majority of our funding.

Support Us and Donate

LKP Managing Agents

Become an LKP Managing Agent

Common Ground
Adam Church
Blocnet property management2

Stay in Touch

To achieve victory in the leasehold game where you are playing against professionals and with rules that they know all too well - stay informed with the LKP newsletter.
Sign Up for Newsletter

Professional Directory

The following advertisements are from firms that seek business from leaseholders.
Click on the logos for company profiles.

Footer

About LKP

  • What is LKP
  • Privacy and data

Categories

  • News
  • Cladding scandal
  • Commonhold
  • Law Commission
  • Fleecehold
  • Parliament
  • Press
  • APPG

Contact

Leasehold Knowledge Partnership
Open Data Institute
5th Floor
Kings Place
London N1 9AG

sok@leaseholdknowledge.com

Copyright © 2023 Leasehold Knowledge Partnership | All rights reserved
Leasehold Knowledge Partnership Limited (company number: 08999652) is a company limited by guarantee that is a registered charity (number: 1162584) with the Charities Commission.
LKP website is hosted at www.34sp.com
Website by Callia Web