A shocking investigation by the Guardian has exposed the ineffective regulations hampering the fight against rogue landlords in the private rental sector. It’s business as usual for one notorious rogue landlord. Bernard McGowan has been convicted of numerous property offences, yet he is still running a very lucrative buy to let property empire. Astonishingly, McGowan has collected more than £1 million in housing benefit, all of which comes from the public purse, despite being ‘banned’ from the private rental sector. £500k of this cash came from the council that banned him!
An Unfit Landlord
McGowan was ruled an unfit landlord in 2015. He was convicted of illegally evicting tenants, disconnecting electricity, changing locks, and worse. His poor tenants probably celebrated when he was convicted, but it seems the judgement held little weight outside of court.
Instead of quitting the buy to let business, the landlord has continued to receive housing benefit for tenants living in his £30 million property empire.
The problem is that council departments have communication problems. In other words, one department doesn’t connect to another. So, even though convicted landlords are supposedly banned from operating because they are no longer eligible for a landlord license, the housing benefit department isn’t told and continues to hand over money.
Tenant Charities In Despair
At least one tenant’s charity is appalled by the news:
“I simply despair,” says Jacky Peacock, the director of Advice4Renetrs. “This is yet another example of one part of the council not speaking to another. Of course, it has to be wrong for a landlord who cannot be defined as a ‘fit and proper manager’ to be receiving the rent. We will never see meaningful regulatory improvements in private renting until there is a joined-up, council-wide approach.
“There is absolutely no doubt in my mind that the circumstances have existed which should have created a duty for Brent to serve an IMO [interim management order] on most if not all of McGowan’s properties,” she continued.
Money from the Public Purse
IMOs are supposed to prevent rogue landlords collecting rental payments after they have been convicted of serious housing offences. Instead, a manager is installed, and s/he collects the rent. McGowan has been fined more than £200k in total, but this is far less than the rental income his property empire continues to generate, much of which is paid for by hard-working taxpayers.
Brent Council, who banned McGowan, have defended their actions. They claim that the landlord has now outsourced management of his properties and only two of them fall under the housing benefit umbrella.
“We are reviewing the two remaining cases to establish whether direct housing benefit payments remain appropriate.”
Nevertheless, it’s clear that the system isn’t working as intended. Sadly, most experts are not all that surprised.
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