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Dublin: 15 °C Sunday 19 May, 2013

Call for inquiry after €32m in state rental deposits goes missing

A Dublin TD is calling the situation a ‘scandal’.

“BIZARRE” AND A “scandal” is how Dublin south west Sinn Féin TD Seán Crowe is describing the revelation that €32 million in rental deposits paid out on behalf of recipients of rent allowance has gone missing.

Yesterday a report in the Irish Times revealed that none of the €32 million paid out in deposits for rental properties since 2006 has been returned to the Department of Social Protection.

Crowe has said today that the news that the Department is not inquiring where the money has gone is ” a scandal that needs urgent and detailed investigation”.

Kevin Humphreys, Labour TD for Dublin south east has said that no procedures are in place for the recovery of such deposits, and that in 2008 alone more than €7 million was spent on deposit-related ‘exceptional needs payments’.

He’s calling for the implementation of a rental deposit scheme operated by the Private Rental Tenancies Board, which he said would protect the sums paid to private landlords, and prevent deposits being wrongfully retained.

He also said that a mechanism needs to be put in place to ensure that those in receipt of rent supplement return their deposits to the State when they move on to social housing or into private accomodation.

Seán Crowe highlights the possibility that the reduction of rent allowances is leading tenants to break the terms of the leases, meaning that the landlord keeps the security deposit.

Crowe said that the government’s decision to cut the rent supplement by €22bn has “resulted in serious difficulties” for many tenants.

A report commissioned by the PRTB is on a proposed deposit protection scheme is due in the autumn, while Seán Crowe is calling for an overhaul of the current system:

… and assurances that taxpayers hard-earned money is accounted for adequately and that tenants are protected from losing deposits and finding themselves unable to seek alternative accommodation as a result.

Read: Dark, damp room or the street – this is the choice faced by many>

Opinion: Landlords who don’t accept rent allowance are lazy – and classist>

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Comments (34 Comments)

  • Years ago I was living in Rathmines. My landlord seemed very nice while we were there.
    Anyway, we gave our notice and agreed a day to do an inspection of the apartment. We got back from work earlier than usual only to find 5 – 6 hammer marks on the walls, that were not there that morning! What the hell!
    We quickly ran to the hardware, got what we needed and fixed the place.
    When the landlord did the inspection he specifically looked where the marks had been made but couldn’t say a word! He just handed our deposit back.
    More than pleased at ourselves.

    Reply
  • I have been lucky enough to recieve rent allowance both times I have been left unemployed in the last few years and never did I recieve anything towards the deposit, I have overheard some terrible things while at the post office in regards to this and I would like to know what practice is in place to recover such money? Is it a case of landlords refusing to give it back in the case of damage to the property by the claimant? I think this should be reviewed with maybe an option of a guarantee by the government that if this is the case they could look at damage and proof of this damage and then have local authorities fix this problem rather than forking out so much money, landlords have it every way.

    Reply
    • Public authorities looking after private houses, is not only a bigger waste of tax money, but also unfeasible. The system was being abused, tenants didn’t care, properties were being destroyed and landlords were using deposits to cover damage and unpaid rent.

      The money should have gone from state to landlord, and landlord to state, completely bypassing tenants. And if the tenants ruined the property or didn’t pay rent or neglected their letting agreements, the landlords were right to keep deposits and the state should have claimed it back from tenants and prevented them from claiming and more benefits. This would meant the €32million would not be missing and would could use it for further social improvements.

      These tenants/people who abused the system should be held criminally liable, it’s benefit fraud and they are essentially stealing from the state.

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    • It sickens me to see so many properties empty in the city.

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    • ”Call for inquiry after €32m in state rental deposits goes missing”??

      32 Million Euros??

      Did you try using a sophisticated strategy to recover this?
      Like asking the tenants to give the money back?

      Try not paying your mortgage for a week
      and a corrupt bank (that you now partly own) will be hunting you down like a criminal with the full support of your government.

      Reply
  • siobeli 11/08/12 #

    As someone who works in a social work sector, and works with community welfare officers and people on rent allowance….the majority of the time it is not landlords but those in receipt of the allowance not giving back their deposit or if moving telling the welfare officers that they didn’t get it back.
    In the last 2 years it has been extremely difficult to get a deposit from the welfare officer, but before this, people often got 2 or more deposits in one year.
    Anyone I have worked with who were on rent allowance treated their accommodation with respect.
    But seen the deposit they got from the welfare officer as their money, not the state.
    There is huge abuse of the rent allowance system. The excuses of “I dont get on with my ma” as a reason to move out and get rent allowance is unfair and unjust on people who genuinely need a home.

    Reply
    • I’ve been lucky enough to receive rent allowance when I was made redundant last year and it was explained to me in no uncertain terms I would not be getting a deposit which I thought was fair enough, it seems this policy is maybe only applied to some. This policy should count right across the board as it would make people value the deposit and property more. Or, if claimants need a deposit, give it to them, but garnish their payments until it is paid back, make it a loan. This kind of press is a poor reflection on people who are in receipt of the allowance and who are decent respectful law abiding people who are unlucky enough not to have a job and who do not trash the premises.

      Reply
    • siobeli 11/08/12 #

      I totally agree with you Ann…people like yourself who worked and payed their taxes, prsi etc should be entitled to and receive a deposit without hassle. It is people who never worked or made a contribution to society who think they should be entitled that should not receive it….give a sob story to the welfare officer and there you go.
      I see 18 years old getting rent allowance just cos they “don’t get on with my ma”.
      While people who have worked can’t get it as easy

      Reply
    • Luna Tic 11/08/12 #

      Hello siobeli, as someone who works in the social work sector you should already know that people who are granted a deposit through their welfare officer have never actually been expected to or ever asked to give it back.
      It is a once off payment granted to people in exceptional circumstances and is by no means easy to acquire. Obviously you must work in an extremely generous office if you are giving people 2 or more deposits a year, as from what I understand, it is only supposed to be granted once and only in exceptional circumstances.

      Reply
    • siobeli 11/08/12 #

      @luna tic. As I said in the last 2 years it’s been difficult to get a deposit, the only cases I have known since than are young people coming out of care and women coming from women’s refugees ,and rightly so. I don’t work in social welfare. I work in the community.
      in previous years, 3 to 4 years ago, I worked with people who received it more than once in a year. It was a given that you got your deposit, on top of money towards bed cloths, saucepans etc if it was your 1st time moving.
      Plus it has always differed from each community welfare officer. Some were more generous then others, but again this has all changed in the last 2 years.

      Reply
    • Luna Tic 12/08/12 #

      @luna tic. As I said in the last 2 years it’s been difficult to get a deposit, the only cases I have known since than are young people coming out of care and women coming from women’s refugees ,and rightly so. I don’t work in social welfare. I work in the community.
      in previous years, 3 to 4 years ago, I worked with people who received it more than once in a year. It was a given that you got your deposit, on top of money towards bed cloths, saucepans etc if it was your 1st time moving.
      Plus it has always differed from each community welfare officer. Some were more generous then others, but again this has all changed in the last 2 years.

      Personally I have never heard of anyone receiving it more then once. I received it myself a number of years ago, under unfortunate circumstances, I had become homeless for a time and was unable provide a deposit to begin renting again. As I recall it was quite difficult for me to provide all the relevant information and documents at the time especially because I had to keep the property on hold until it was decided whether or not I would be eligible or not. Thankfully I was, and sincerely grateful to the system and the people of this country for allowing me to get back on my feet. But I would hardly have said it was a given, and there was never any mention of money towards bed cloths, saucepans etc.
      The point I’m trying to make is that I was informed that it was a once off payment and that I was to use the money to pay for any subsequent deposit again if I were to move. From what I understood I would not be entitled to receive any further help from them in the future regarding a deposit to rent. There was never any suggestion that I would have to pay it back.
      The money isn’t missing as far as I can tell, it is a problem of the department being unclear about the conditions of such a payment. I would like to have some clarification on the actual terms of the payment.

      Reply
    • Luna Tic 12/08/12 #

      sorry for repeating your comment siobeli.

      Reply
  • You’ve a 50% chance of getting a deposit back in this country even when a place is left immaculate. Back in the day, the deposit was essentially regarded as extra income for landlords. Scenarios like “ah jaysus, will ye look at the mark on the wall. I’ll have to have the whole house repainted, by meself, at a cost of €200 an hour so I’ll be keepin’ the deposit” *jingles keys*. Legally they can’t really do that anymore but deposits are still held on the most spurious of reasons. Mosts cases referred to the PRTB are about illegally witheld deposits of which almost all are ordered returned.

    Typical gambits include trying to get tenants to pay for normal wear and tear, denying notice was given when it was, ignoring phone calls and e-mails once the tenant has already left, inventing spurious costs and trying to charge for phantom bank fees (had this happen to me once), grotesque overexaggeration of the costs repairing minor damages. I’d say if you’re completely honest and treat a place well you have a one in two chance of fairly getting your money back with recourse to the PRTB.

    There’s a simple solution to all this grief – have the deposits held by the PRTB in a scheme, irrespective if they are private deposits or paid for by the state. The tenant would feel they will get the money back honestly and will also not be able to just allocate it against the last months rent – something that’s becoming every more common much to the chagrin of Dublin’s landlording classes.

    Reply
    • Too expensive to administer…

      An easier solution would be where the landlord should be made to pay the tenant 2-3 times the deposit if found to be unfairly holding it… Then they would hand it back without hesitation unless they knew they could prove the tenant damaged the property etc.

      Reply
    • Oh, and should any doubt my bona fides on this matter, take a butcher’s at the forum over on irishlandlord.com – one memorable post includes a latter day Rachman brazenly bragging about how he’d never returned a full deposit in his life.

      My point is that you’ve usually got to fight to get it back anyway and you’re much more inclined to do that when it’s your own cash at stake.

      Reply
  • I think the PRTB are already doing something similar, Andrew. Because of the volume of these cases they were getting they will not only order the deposit to be repaid but will now also slap a heavy fine on the miscreant.

    Reply
    • The PRTB are nothing more than a joke. I had a property so badly damaged it had to be completely stripped of every item in , incl carpets, furniture, heaters, built in kitchen appliances and then the entire home redecorated and furnished before I could relet. The PRTB found in my favour to the tune of just €6,000 despite it costing over €30,000 to put right. Three years later I’m still waiting for the money………. Like every other quango in this country it’s all mouth but no substance

      Reply
    • Hmm. What you’re talking about there is clearly criminal damage/vandalism. I would think that’s outside it’s remit but there should certainly be a mechanism to prosecute that level of destruction with money deducted from wages/benefits until compensation has been made if not actual jail time.

      Reply
  • All of these type of problems stem from the lack of real investment in social housing leaving it up to private investors and speculators. We need to grow up as a country and start providing services to our citizens which can be planned for and. Providing schools and other services in the areas where they are required. Not the mess of a “planning” system we have. For this we will have to pay a bit more in taxes. Worth it though in my opinion.

    Reply
  • its a joke d amount of deposits ive lost because landords dont want to give it back any excuse they come up wit one kept it because i was a day late in giving my notice another kept it because i had to move because i couldnt live in the place windows leekin oil thing out the back was leeking and i lost a fortune on oil there was also a stink of keroseen in the house and the “new” bathroom suit that was ment to b put in before i moved in wasnt finished and leeks were coming through the roof and lights so i couldnt even use the shower i gave a months notice as the landlord would not fix the problems and with the leeking oil and smell of kreoseen in the house i couldnt stay so when it came to me getting my deposit back it wasnt happening because i broke the contract when infact the landlord did and he had agent fees and daft adds he had to pay for all at my expence so i never got that deposit its a joke a deposit should only be held if there is damage to a property or the rent isnt paid to date

    Reply
  • For our previous tenant we gave the deposit (well most of it, the kitchen lino was damaged and had to be replaced) back directly to the Community Welfare Officer by cheque. So I don’t know how nothing has been accounted for.

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  • Oh FFS! What will our EU/IMF overlords make of this?

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  • From my experience of rent allowance and not all, but in the majority of cases these people wreck the houses. This is not one bit surprising.

    Reply
    • How much experience have you exactly and what kind?

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    • I worked for a rental agency.. The state the houses would be left in after rent allowance was diabolical. Very easy to see it wasn’t their own money put down as a deposit. Personally with my own properties there isn’t a hope in hell I’d take rent allowance.

      Reply
    • Not all, but alot of people receiving rent allowance (free rent allowance, actually) dont have the same respect for a property than those who have to pay for it themselves would have. Its kind of a case of “easy come, easy go”

      Reply
    • is it not the rental agencies job to do background checks? how many rentals are returned as they were rented and how many were not?

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    • I wonder do landlords who refuse rent supplement as a matter of course realise that they are discriminating against disabled people?

      People in receipt of disability allowance also receive rent supplement, and as I already explained to you on another article Lauren, those people on disability allowance (not benefit) are actually disabled. Not all disabled people have visible disabilities either..

      Perhaps landlords and agencies should actually meet people (and learn a little bit about the idiocy of sweeping generalisations) before telling them no.

      Reply
  • The money is all gone by now. Landlords have probably needed to use it to refurbish, cover unpaid rent and/or for contract breaches from tenants who just don’t care because it’s not their money and it’s not their property.

    It’s a terrible situation where we are providing social help to those who need it and the system is being abused. €32million deposits must be for 10s of thousands of properties, it seems utterly unfeasible that there are that many people who can’t pay any rent.

    It’s sad to say but such schemes should be scratched entirely because it’s just being abused. It should have been regulated much better from the start. Landlords should have been returning it to the council, not the tenants, and councils that had the deposits withheld, if it was because of the tenant, they should have to cover the cost and prevented from reclaiming any benefits, the money would have been returned to the state, landlords would have their properties looked after, and the system could continue.

    Constantly disappointed with Ireland, a great idea gone horribly wrong, due to poor management, and no common sense.

    Reply
    • I have rented a few years now and have had two landlords keep my deposit for no reason other than they wanted to, they made terrible excuses to why they were keeping it, all rent was paid in full for the term of the contract and I lived alone so there was no damage or neglect. I simply did not have the money to take legal action. I know first hand that the landlords are not blameless and they abuse the system just as much as tennants do.

      What also sickens me is the people who seem to get the deposits covered are people who make no contribution to society financial or otherwise and have not done for years, I would love to know how much of that 32m that is missing is down to these people.

      Reply
  • Would it be fair to ask Sean Crowe where the £24m from the Belfast Bank robbery went in 2004? I’m aware this post has nothing to do with the original statement, but it’s pure hypocrisy by SF to get up on there high horse and preach.

    Reply
  • Come on people recover tax payer’s money and upset someone you must be kidding.

    Reply
  • Rentalgate 300,000,000

    Reply

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