'Desperate' business people are being targeted by cowboy ratings surveyors, says Colliers

Growing numbers of desperate business people are being conned out of money they need to survive the pandemic by cowboy rating surveyors, according to one of the world's largest investment management companies.

Kevin Hollinrake MP has raised the issue in Parliament

Colliers said it was concerned about reports of a significant escalation in the number of cases of cowboy rating surveyors targeting struggling businesses which are looking to reduce bills during the pandemic.

Colliers said a recent Parliamentary debate called for industry regulation to protect vulnerable businesses who are suffering financial distress from falling victim to such rogue rating surveyors.

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The rating team at Colliers has called on the RICS, (The Royal Institute of Chartered Surveyors), to step in and regulate the rating industry.

In a statement, Colliers said: "An increasing number of businesses, including Colliers clients, are being approached by rogue rating surveyors promising to obtain a marked reduction in their business rates bills.

"Some businesses, unaware they are entitled to reliefs are being targeted by the rogue agents to secure small business reliefs or 'Covid' reliefs despite the fact the businesses are in sectors that would have received them for free, by purely writing to the local authorities.

"The small business involved is then charged an annual fee of up to 52% of the 'saving' for the length of the contract. In some cases, businesses have been tied in for 10 or 12 years."

Colliers added: "It is not only the smaller businesses that have suffered from unscrupulous rating surveyors. The number of such incidents has particularly grown during the lockdowns, when many office based businesses, who did not receive the business rates holidays seen in other sectors, struggled to pay their rates bills and became more vulnerable to such a cowboy element.

Colliers added: "A particular spike was seen at the beginning of the year when businesses were led to believe that the government’s Valuation Office ( the VOA) had agreed to a 25% reduction on business rates for those mounting an MCC, or material change of circumstance, appeal and rogue surveyors made promises they could help obtain this relief. There is no such relief on offer."

John Webber, the head of business rates at Colliers, said: "Businesses are getting desperate. Some who are entitled to reliefs were not aware of them and have therefore been targeted by rogue rating surveyors. Others who are not receiving any support, but with no announcement by the Government of any forthcoming, have been clutching at straws.

"Rogue agents are able to take advantage of this distress. We believe the situation will only get worse after the end of June, when the 100 per cent rates holiday comes to an end for businesses in the retail, hospitality and leisure industries and Government support lessens. Businesses must beware of false promises.”

Mr Webber continued: “We have long been campaigning for the rating industry to be properly regulated and we are supportive of Kevin Hollinrake MP raising this issue in Parliament. We believe there should be a register of appeals professionals, which should be regulated by the RICS, in the same way the FCA regulates financial advisors.”

He added: “The lack of such a register gives a cowboy element the opportunity to gain credibility and persuade vulnerable businesses that it can save them serious funds. In the current crisis this situation is getting more out of hand. We call on the RICS to take robust measures to effectively show these cowboys for what they are and take some leadership on a problem which has existed for many years.”

An RICS spokesperson said: “It is concerning that people are taking advantage of businesses who may be in financial distress, as well as those who may not be completely aware of the ins and outs of the complicated system that is business rates.

“RICS empathises with the position many businesses find themselves in further to the impact of COVID-19, and has highlighted the need for more support for businesses in our response to the HM Treasury ‘Fundamental Review of Business Rates’, and also in our direct engagement with Government.

“While you do not have to be an RICS professional to be a rating advisor, we would advise the use of RICS members and regulated firms where employing business rates services, before agreeing any work."

"RICS rating surveyors are fully regulated against RICS standards, including the Rating Consultancy Code of Practice and our Code of Ethics. This ensures the work is of a high standard, and the Rating Consultancy Code includes requirements for terms of engagement to protect the clients of these services and the public interest.

"If any client has concerns about an RICS professional, they can follow the set out regulation procedure with RICS.”

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