Member Standards

Context

The Housing and Planning Act 2016 enables mandatory membership of approved Client Money Protection (CMP) schemes for letting and managing agents in England.

What is Client Money Protection?

CMP is a compensation scheme that reimburses landlords and tenants if an agent goes bust or misuses client money (loss, theft, or misappropriation).

• Includes unprotected deposits not registered where required.
• Includes interest earned that is due to client.

Eligibility and approved schemes

Agents in England holding client money must belong to a government-approved CMP scheme.

Examples include Money Shield and Propertymark.

Core member requirements

• Maintain appropriate Professional Indemnity Insurance cover.
• Repay client money (and due interest where possible) without delay when no longer required to hold it.
• Hold client money in appropriately designated client money account.

Transparency requirements

• Obtain certificate confirming membership of approved CMP scheme.
• Display certificate prominently in each premises dealing face-to-face with consumers.
• Publish certificate on website.
• Produce certificate free of charge on request.
• Notify clients in writing within 14 days of scheme membership changes.

Enforcement and penalties

• Enforced by local authorities in England.
• Civil penalty up to £30,000 for failing to belong to approved scheme.
• Penalty up to £5,000 for transparency requirement breaches.
• Appeal rights apply after Notice of Intent and Final Notice process.

Source

Money Shield CMP Fact Sheet (June 2020), reproduced locally as summary content.