Missing deposit money leaves tenants and landlords fuming

Missing deposit money leaves tenants and landlords fuming

When Tower Property Services went into liquidation in October last year, it left a trail of unhappy customers, many of whom have since logged on to the review website allagents.co.uk to detail their dissatisfaction. "Words alone cannot express just how poor this company treats anyone it comes in contact with," was a typical view of recent dealings with the firm, which had traded in east London and Romford since 1993.

A letter sent to creditors in February by the liquidator SFP, which has been seen by Guardian Money, said the account in which tenants' deposits were held originally, had £71,000 in it, but its investigations found just £14,000 was left – and NatWest was seeking to offset a further £7,000 overdraft.

Numerous former landlords and tenants besieged the company trying to find out what had happened to their deposits.

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In early investigations, SFP concluded the firms' monies had become "commingled", or mixed together. It also said 50 of the 64 landlords and tenants who opted for the deposit protection scheme, which should have safeguarded their cash, lost out as the monies had not been paid, or there had been problems opening the account.

In a statement, partner Simon Plant, said: "During the liquidation of Tower Property Services, we immediately identified possible irregularities in the company's trading which would require further detailed investigation. SFP Forensic is now carrying out these investigations and, until they have been completed and a conclusion advised to the interested parties, we are unable to comment."

Money tracked down TPS's former managing director Gary Gibbons this week. He is listed on a student accommodation website as the contact for a lettings agent, City Prime Residential, in Surbiton, south-west London, although he said he was "currently not working in the industry".

When asked of the whereabouts of TPS's landlords' deposits, he said that, as far as he was aware, no landlord should have lost out and that the liquidator was dealing with the matter.

"I was MD but in a non-active way at the end, and as far as I know everything was above board. I am quite shocked if landlords have lost out as a result of the liquidation. If your reader contacts me I will be more than happy to pay her back the deposit she lost."

Gibbons blamed the company's failure on the "economic situation" and said it was owed £250,000 by creditors when it went down. He declined to reveal who was running the company at its demise.

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