One year after its introduction, a leading provider has declared the government’s Tenancy Deposit Scheme a success.

According to MyDeposits.co.uk, 200,000 deposits had been taken since the scheme began on April 6, 2007. In turn, these were then protected by more than 31,000 landlords and letting agents.

Out of this large volume of deposits, only 341 actual disputes (64 cases) were recorded and just 20 per cent of the reported disagreements required adjudication through Alternative Dispute Resolution (ADR).

David Salusbury, chairman of MyDeposits said, "After only 12 months, it is quite clear tenancy deposit protection has clarified the rights and responsibilities of tenant, landlord and letting agent”

"With so few disputes actually being notified and only 20 per cent of these requiring external adjudication, it seems that this kind of self-regulation is proving to be extremely effective."

This ADR relies on all parties to provide evidence in order to reach a final decision on how much, if any, of the deposit should be returned to the tenant.

The ADR found 86 per cent of the disputes to be in favour of the tenant. As a result, 45 per cent received their full deposit and 41 per cent received a portion of their deposit deemed fit by the adjudicator.

In 11 per cent of cases, landlords and letting agents were able to withhold the total deposit.

"The risk to landlords of not complying with the legislation is considerable," said Mr Salusbury.

"Not only would a landlord appear to be totally oblivious to their legal obligations but they will receive a fine amounting up to three times the deposit. In addition, for as long as the deposit remains unprotected, a landlord faces significant limits on their ability to seek possession."