This article follows on from related articles
In the last few weeks and almost immediately after their last trading statement, Purplebricks listing numbers showed an incredible number of listing anomalies, with thousands of properties suddenly disappearing from the website over the period of a few hours and days and, a significant number of duplicate and quadruplicate listings with differing unique identifier numbers being identified by individuals and public source data from Zoopla/ Rightmove etc.
It is impossible to say with certainty whether this anomalous activity is innocent or an attempt to manipulate figures although the company have previously admitted to having to ‘audit’ their listings when questioned about re and multiple listings by The Times)
Since my last blog, I have been trying to ascertain why the regulators appear reluctant to do their job. There appears to be an embarrassing game of pass the legislative parcel and a wall of silence between The Property Ombudsman Scheme (TPOS), The National Trading Standards Estate Agency Team (NTSEAT – who oversee the property redress schemes) and the National Association of Estate Agents/ Propertymark (NAEA) who are an estate agency membership organisation and one of the Nationally recognised awarding bodies for the NVQ qualifications in estate agency.
If you want to work as an estate agent in the UK running your own business, even as a franchisee, the law says you must (amongst other things):
- Belong to a recognised Government redress scheme as approved by NTSEAT
- Be registered for Anti Money Laundering with Her Majestys Revenue and Customs (HMRC – Section 1.9)
- Be registered as a Data Controller with The Information Commissioners Office (ICO)**
Failing to comply with numbers two and three are a criminal offence. Failing to be a member of a redress scheme is a civil offence under the 1979 Estate Agents Act.
As previously revealed, Purplebricks PLC failed to register any of their franchisees with an approved redress scheme until June 2016. The Law states that Agents must register with an approved redress scheme, not that consumers must have access to redress however, neither NTSEAT seem keen to take any action despite this apparently clear breach of the 1979 Estate Agents Act and, TPOS were more than happy to take a large number of lucrative registration fees (they are a commercial company, not a government organisation) despite knowing that none of these firms had previously been trading unlawfully and, had no ICO or AML registration.
Now here’s the first very odd bit.
- Purplebricks make it clear that all of their franchisees are self-employed.
- The franchisees are all registered separately at Companies house as independent limited companies (Ltd.)
- The NAEA compliance team (who take advice from Warwickshire Trading Standards as Primary Authority on such matters) regard all these franchisees as self-employed and, to have individual redress, AML and ICO registration
- TPOS require all franchisees to register with them as independent companies (as many legitimate franchise firms do)
- NTSEAT, however, take the formal view that the franchisees are ’employed’ and thus, do not require to be registered for ICO or AML.
NTSEAT, as part of Powys Council, who bid for the taxpayer funded role, initially appeared to be strongly in support of taking action against portal juggling, (rightly) invoking the Fraud Act, Consumer Protection Regulations and Businesss Protection Regulations Act in various press releases and at conferences.
However, after a year with an immense amount of independent data and yet without a single prosecutions and an apparently isolated and unique view on the status of Purplebricks Franchisees (all other franchise firms such as Northwood PLC etc. are all individually registered) it seems that NTSEAT, as part of Powys Coucil do not want to take action against a company that is well-known for flexing expensive litigious muscles.
The NAEA too, are acting rather oddly. Despite having clear rules on membership and transparency etc. they are refusing to answer some rather simple questions or make clear statements about trading legally. They are also very reticent about their relationship with Purplebricks who their MD, Mark Hayward recently publicly praised for their transparency, despite PB PLC being serial offenders on the ASA naughty step and appearing on BBC consumer programs Watchdog, Moneybox and You and Yours for all the wrong reasons. Read more