Hundreds of thousands of pounds of tenants' deposits are being withheld by landlords and letting agents in Brighton and Hove.

This is money tenants feel they are owed after they have moved out but there is often nothing they can do except take legal action, which can prove costly and intimidating.

Rogue landlords and agents are often able to keep the money without a fight.

Unsure of the vagaries of the small claims court and fearful they cannot afford the cost if they lose, tenants frequently give in.

There is no compulsory registration, licensing or training of estate and letting agents in this country.

Brighton and Hove is England's letting hot spot. At 20 per cent, the city has a higher proportion of rented accommodation than anywhere else in the country.

Rogue, or "cowboy", agents are free to set up shop anywhere, anytime.

They do not need experience, expertise, or morals.

There are professional bodies, such as the Association of Residential Letting Agents (ARLA), who have rules designed to keep agents in check and deposits safe but membership is optional.

The Government recently tested the Tenancy Deposit Scheme in the city, whereby deposits were independently held by a third party who settled any dispute but membership was again optional.

Campaigners say these schemes are all very well in principle but in practice they have no bite.

Anthony Garrioch, 20, is fighting for his £550 deposit after he moved out of a flat in Stoneham Road, Hove, in January.

His agent, Property Solutions, told him he could have a cheque next day.

But the business closed down and Mr Garrioch has since been unable to trace the director.

He is considering court action but does not see why the onus should be on him to fight for his own money.

Brighton and Hove Citizens Advice Bureau (CAB) has dealt with £110,000 worth of deposit disputes in the past year.

It estimates the total amount held by the city's letting agents and landlords, after tenants have moved out, is between £500,000 and £1 million.

Brighton and Hove CAB found a higher proportion of vulnerable tenants had complaints. Two thirds were female and aged under 30, one third was unemployed. Two complaints came from European students refused their deposit before going home and one was from the ethnic minority.

The CAB wants Government regulation covering how and where deposits are held, how quickly they should be returned and who benefits from interest payments.

Tenants are not the only ones complaining.

Reputable agents are equally keen to see rules put in place to clean up a predominantly honest industry soured by a few bad apples.

Alan Thurlow, a director of Leaders letting agency, said he wanted to see mandatory licensing of anyone involved in letting residential property.

He said: "Neither a new landlord nor a new tenant knows whether they are dealing with a cowboy agent until after the tenancy agreement has been signed and problems commence.

"These problems not only relate to the holding of tenants' deposits and clients' money but to the standard of properties, their safety and compliance with health and safety regulations.

"It is extraordinary that the garage which provides an MOT certificate for my car is regularly inspected, tightly regulated and licensed. Yet a letting agent can open a business tomorrow morning without any qualifications."

Rather than deposits being kept safe, Leaders has found several examples where agents used the downpayments to furnish their own lifestyle.

Anthony Whitehead, from letting agent PPS in Hove, said he thought the industry's problems would be sorted out with Government legislation.

He said: "I think we need to be licensed and regulated.

"It is essential tenants' money is held in bonded accounts. That way, the money can't go missing and there is a mediator to settle any disputes."

Brighton Kemp Town MP Des Turner is leading a Westminster campaign for legislation to deal with the deposit problem.

After taking up the campaign on behalf of charity Shelter, Mr Turner told The Argus: "Landlords will think of all sorts of reasons to withhold deposits.

"I think a mandatory scheme is the only way to safeguard tenants' money and guarantee any disputes which do take place are settled promptly."

Agents point out that a lot of deposits are withheld for good reason.

But, without an independent judge to settle disputes, the arguments will continue.