Question: I deal with several property managing agents. Some of them have told me that they will become company secretary of the residential management company/property owner and by doing so stay outside regulation. Is this correct and how should I proceed?

Answer: The Companies Act and FSA rules permit this. However, by acting in this capacity, there is clearly potential for a conflict of interest to arise.

To enable an intermediary to deal with a property management agent (PMA) in a company secretary capacity, all the business needs to be conducted through the position of company secretary.

Biba has put together the following checklist to help intermediaries demonstrate that the possible conflicts of interest have been addressed:

  • The PMA must be the registered company secretary and this should be confirmed on the residential management company's (RMC) headed paper. It would be prudent to check on Companies House website that this is the case
  • All communication with and from the company secretary must be in the RMC name, including letterheads, email and telephone
  • If the company secretary is an individual, no work can be delegated by him/her to any other person within the PMA
  • Bank accounts must be in the name of the RMC (and compliant with current landlord and tenant legislation), not a client account at the PMA.
  • The FSA will be determined to see clear evidence that any actions the PMA takes are those of a customer and not a property managing agent.

  • Steve White is regulation and compliance manager at Biba