Many Landlords may be under the impression that if illegal activity is carried out in a property that they are renting out, that they will be protected by their insurer but sadly this is usually not the case. We are here to guide you through what to look out for to ensure that you are not left uninsured due to some troublesome tenants.
We are going to talk you through the common and unusual scenarios that are leaving landlords properties all over the UK, vulnerable and at risk.
Cannabis Cultivation – The more common risk
We understand that you cannot assume what your new tenants will use your property for, they may appear to be the perfect tenants when you initially meet but this doesn’t mean that you shouldn’t keep your eyes open for these signs of cannabis production:
- Curtains / blinds drawn all of the time
- A strong and sickly sweet smell
- A consisting buzzing noise that may come from industrial lighting
- Reluctant for any maintenance work to be carried out
- Frequent visitors to the property that stay for a matter of minutes
Of course these signs do not categorically mean that your tenants are cultivating cannabis, they just prefer to have their blinds closed for privacy so you should not jump to conclusions o quickly but if you are noticing several of these signs you need to take action.
If you are certain that your tenant is growing cannabis in your property you must contact the police, to contact your local police force call 101. If found out that you knew of illegal activity taking place in your property, you could be prosecuted under Section 8 of the Misuse of Drug Act 1971. If you are unsure how to approach this scenario, you should take legal advice.
What does Section 8 of the Misuse of Drug Act 1971 Cover
This act enforces legal action to the occupier or the management of any premises that has allowed any of the following illegal activities to take place in said location:
- The production or attempt at production of a controlled drug
- To supply or attempt to supply a control drug to an individual
- Preparing opium for smoking
- The smoking of cannabis or cannabis resin
If you are found guilty of this act you can face up 14 years in custody as well as fines (Source: Drug Offences Definitive Guideline – sentencingcouncil.org.uk).
Human Trafficking – The negative & traumatic risk
In comparison with the number of properties found being used to cultivate cannabis, human trafficking is nowhere near as common but it can be more damaging to your property.
If you are ever unfortunate enough to experience human trafficking occurring within the property that you have let you are likely to find the experience quite traumatising as will your neighbours, so here are a few things to look out for the avoid this from happening:
- Your neighbours will struggle to identify the tenants due to the volume of people going in and out of the property
- People present in the property way have visible injuries or bruising
- High level security features or reinforced windows and doors
If it is found that human trafficking has been occurring in your property there will be very negative views towards it. The neighbours may have heard or witnessed uncomfortable scenes in relation to the trafficking, making the neighbourhood a glum place for a while.
Even worse, the illegal activity may attract some press which may cause a very negative impact if you were to try and let the property again. If it is found that human trafficking has been operating in a property that you own you could be sanctioned under Section 4 of the Modern Slavery Act 2015, don’t let this happen to you! If you fear that this may be happening in your property you need to call the police on 999 and the Modern Slavery Helpline on 0800 0121 700 immediately.
What does Section 4 of the Modern Slavery Act 2015 Cover
Section 4 of this act sanctions against anyone who commits an offence with the intent to commit an offence under Section 2. Within Section 2 there are details on what Human Trafficking is in the eyes of the law and by knowingly providing a premises for this to take, place, you are procuring an offence under this section. Click here for more information on Section 2.
Prostitution – The reputation risk
Although this sort of business will try and be as discreet as they can be it will often because apparent very quickly to neighbours in regards to what kind of business is going through the property. Our top tip to avoid this kind of organised crime is to stay in touch with neighbouring properties, this way you should know very promptly if they suspect anything.
If you are able to carry out Right to Rent checks keep an eye out for little equipment in the kitchen, very few personal belongings in the bedrooms and minimal features throughout the property. If it seems like there are any permanent residents living in the property this could be a sign of illegal activity taking place.
This kind of organised crime can often be a quick fix once the police are involved but it could cause ongoing issues for future tenants. The last thing that your tenants will want is unsolicited visitors at the door all throughout the night.
If you knowingly let your property out to be used as a brothel you will be liable for prosecution under the Sexual Offences Act 2003. If you fear that this is operating within a property that you have let out be sure to get some legal advice to protect yourself and your asset.
If you fall victim to this organised crime your insurance will be invalid
Across the panel of UK insurers the majority of them will not be able to cover you if you fall victim to any of these crimes which is why is it so important to keep an eye on all of your properties within your portfolio.
If you find yourself impacted by organised crime it could be your worst nightmare, it can affect yourself, your neighbours and your assets. Don’t let yourself become a victim of one of these horrendous situations.
If illegal activity has taken place in your property – whether that is the production of cannabis, human trafficking or prostitution, it is unlikely that your insurance will cover you for this eventuality. Insurance policies contain an ‘illegal activities clause’ which will invalidate the policy. Also, your property would also have been being used for commercial purpose, which contravenes landlord policies.