Countrywide has this afternoon released a statement suggesting it has, in its eyes, settled the controversy over unclaimed lettings funds being diverted into company accounts.
The agency group today faced a disciplinary meeting for allegedly breaching Royal Institution of Chartered Surveyors rules.
One of RICS’ charges said that £10,093,866 of unidentified client funds in Countrywide’s lettings division - which had remained unclaimed for six years or more - had been diverted from the agency’s client account to its office account. This involved an alleged failure by Countrywide to safeguard its clients’ funds.
An additional charge said the firm’s conduct represented a serious and prolonged disregard to professional obligations set out in RICS’ client money guidance document.
However, the company's statement this afternoon says: “Back in 2008 we started to accumulate many thousands of individual small amounts on client accounts in our lettings businesses, where funds over six years old could not be traced to source. Some would have been rightly Countrywide funds and others small amounts of landlord/tenant sums that could not be traced. It was agreed at the time to move these untraceable amounts to an office account and put in place an indemnity that, should ever a recipient be identified, the amount would be paid across. In reality less than 1% were ever traced after six years. Immediately we paid over the amount due and customers did not suffer any loss.
"After ten years of audits an issue was raised in 2018 that this may not be in accordance with RICS Rules. Countrywide repaid all of the funds that had been transferred from office to unnamed client accounts. Importantly nobody has been disadvantaged but we decided to resolve the RICS matter immediately through a full transfer.”
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Bet that was a blow having to put that money back at this time for them
I am surprised FD allowed it in the first place but I imagine everyone on the Board was aware.Warning shot to others perhaps.
Is it any coincidence that the removal started in 2008 when the business was no doubt short of cash like many were, and desperate times for some businesses meant desperate measures. They have now returned the cash, but was it just cash? Where was this cash injection reflected in their accounts, did they take it all to revenue as well? If they did that's a £10m write off that needs to be reflected on top.
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