Letting company to pay £12k as council uses POCA over rent from unlicensed property

A letting company has been ordered to stump up more than £12,000 in fines, costs and repaid rent over the state of one of its unlicensed properties, after a London borough pursued a compensation order under the Proceeds of Crime Act.

Sumal and Sons Properties, of Stamford Hill, had been found guilty in their absence at Stratford Magistrates’ Court of failing to license a two-bedroom house in Manor Park. The property was located in a Neighbourhood Improvement Zone.

Sentencing was committed to the Inner London Crown Court last month as the London Borough of Newham sought a compensation order.

The council argued that the rent paid to the defendants while the property was not licensed should be deemed to be a criminal benefit.

Council enforcement officers reported that the house was overcrowded, with families sharing single rooms. There was also severe condensation and damp, and poor insulation.

Sumal and Sons was fined £2,000 and ordered to repay £6,500 in rent. The company will also have to pay £4,000 in costs.

In September Newham launched a consultation on a licensing scheme for all private landlords in the borough. Thought to be the first of its kind in the country, the scheme would apply to an estimated 35,000 tenancies. It is expected to come into force by July 2012.

Newham Mayor Sir Robin Wales said: "We will never accept private sector tenants being directly exploited by landlords who force them to live in dangerous and unacceptable conditions.

"Good landlords have nothing to fear from this scheme. For the bad ones, this a clear message they must clean up their act."