News & Blog

Client money protection is coming in 2019

Scrabble board showing text 'the law is changing'



From  1st April 2019 letting agents in England will be required by law to belong to an approved client money protection scheme to protect landlord and tenant money. Agents are required to comply or face heavy penalty fines of up to £30,000. The government estimate that around 4,000 agents will be required to obtain membership of a CMP scheme prior to the legislative deadline. Now more than ever it is important to understand your legal obligations as a letting agent and ensure that you are compliant. 


What is client money protection?
Client money protection is designed to protect client money held by property agents. Client money protection offers financial protection for landlords and tenants that their money is secure whilst being held by an agent, and also helps to continually support and raise standards within the property industry. In the event that monies are misappropriated by an agent, in the course of running their business, client money protection helps to return monies to the affected parties (landlord and/or tenants).

What does a compliant agent look like?
Agents should already be aware of the coming legislation and be putting measures in place to ensure they are compliant on 1st April 2019. Many agents may already have access to client money protection as a result of their membership to an agent body such as ARLA, RICS, NALS or UKALA.

Client Money Protect (CMP) – the PRS’ partner CMP scheme and part of Hamilton Fraser, parent company to mydeposits, has been running a voluntary client money protection scheme since 2014 with over 800 agent members. In February 2019 Client Money Protect was announced by the government as one of the first schemes to be authorised to provide mandatory client money protection to agents in England having already been approved by the Scottish Executive and Rent Smart Wales. You can find out more about Client Money Protect by visiting the website

Joining a client money protection scheme
Agents need to comply with a number of standards in order to join a client money protection scheme. In relation to most of the schemes agents are required to;

• Have a segregated client money bank account
• Have membership of a consumer redress scheme (PRS or TPO)
• Have professional indemnity insurance
• Agree to abide by the scheme’s Scheme Rules or Terms and Conditions
• Agree to appear on the scheme’s website
• Display the scheme’s logo in their branch(es) and on their website
• Provide landlords/tenants with information about client money protection and their membership of the scheme

Additionally, relevant credit and fraud checks are carried out on agents to help to identify whether client money is being held correctly. 


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Property Redress Scheme is approved by Government under the Alternative Dispute Resolution for Consumer Disputes (Competent Authorities and Information) Regulations 2015