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Fines for bad landlords ‘too low’

Tom Wall23/07/2015 - 07:30

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Landlord fines are 'a drop in the ocean'
Landlord fines are 'a drop in the ocean'

Housing campaigners have urged to courts to impose higher fines after EHN’s analysis revealed that rogue landlords had only been fined a total of £3m for housing offences since 2006.

Betsy Dillner, director of tenant rights group Generation Rent, said the fines imposed on rogue landlords did not begin to compare to the profits that are made.

‘Criminal landlords are raking in £5bn in rent a year, so the fines are a drop in the ocean. If we can’t hurt slumlords with fines, they won’t be driven out of the market,’ she said.

Stephen Battersby, CIEH vice president, said many rogue landlords seemed to consider fines to be a business expense.

‘The fines are puny by comparison with the rental income, just compare with the amount of housing benefit in the private rented sector. It is easy for landlords see any fines as a business expense and a risk they are willing to take as they have to be caught first,’ he said.

Giles Peaker, a leading housing law solicitor, who edits the influential Nearly Legal Housing Law blog, said fines had in the past been ‘pathetic’ but would start to increase now the cap had been lifted.

‘The fine level should increase now the upper limit has been raised from £5,000 per offence to unlimited,’ he said. ‘My impression is that 2015 should see significantly higher figures.’

Mr Peaker said the Housing Act 2004 had not succeeded in driving out rogue landlords partly because legal action was costly for councils.

‘It is wholly reliant on local authorities taking action. That has been extremely variable. The difficulty is that they don’t get to keep any of the money. So prosecution activities are not funded and it gets expensive,’ he said.

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EHN’s investigation also reveals that many rogue landlords receive public money in the form of housing benefit.

The most prosecuted landlord in England and Wales, Katia Goremsandu is receiving housing benefit from her tenants.

Harbinder Singh Athwal, who received one of the highest fines, and Brent Burton, who has four housing convictions, also received housing benefit.

The most prosecuted firm, Aspire Developments, has been paid £427,000 through housing benefit since 2013

Councils can only refuse to make a payment if a landlord has been involved in fraudulent acts. They are not allowed to take into account non-benefit issues such as housing convictions.

Bob Mayho, CIEH policy officer, said: ‘The whole housing benefit system needs to be examined. In my view there are shocking wastes of public funds being misdirected into the hands of some landlords that fail to meet their legal and moral obligations.’

Russell Moffatt, Newham Council’s operations manager, said the rules should be changed so that rogue landlords cannot receive housing benefit. ‘It is wrong that convicted landlords are still allowed to benefit from public money. The law should be changed to stop this from happening,’ he said.

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