Propertymark is to probe Purplebricks over its lettings fiasco - and as the agency becomes a subject of ridicule in the business world.
A statement last night from David Oliver, Head of Propertymark Compliance, says: “It is important that any allegation made against an agent be substantiated with viable evidence.
“As a representative body we take any allegations against our members incredibly seriously and we will be investigating the claims of failure to properly register tenancy deposits by Purplebricks.
“Legal procedures exist to protect both agents and their clients. Performing them properly not only protects agencies but is paramount for consumer confidence, providing transparency between businesses and their customers.
“Agents fight against a stigma and ensuring processes are in keeping with legal and professional standards is a key part in changing our reputation.”
Purplebricks says it expects to make a provision of millions of pounds to cover a long-standing blunder in its lettings management business.
Its early estimate of the costs is between £2m and £9m; the Daily Telegraph says it could be up to £30m.
The beleaguered agency was scheduled to have released its half year figures to shareholders today, but has now delayed these indefinitely.
Meanwhile in a separate article this morning, the Telegraph pillories the online agency for its almost non-stop record of crises in recent months.
The new article begins “Lurching from crisis to crisis, Purplebricks has been an exhibition in value destruction” and goes on to explain how the agency was once valued at approaching £1.5 billion and is now worth around £77m following a series of share price collapses.
Purplebricks made revenues of £91m in the year to the end of April, but a £9m hit for the rental mistake would have wiped out operating profits of £8.2m.