Many homeowners have fallen foul of unscrupulous sale and rent back companies who offer the false hope of keeping people in their homes, but can ultimately leave them homeless.
The Financial Services Authority introduced an interim regulatory system on 1 July this year to drive out rogue operators in the sale and rent back industry once and for all, with a tougher full regime launching in 2010.
Over the last two months, the housing charity Shelter has been investigating sale and rent back companies who take out adverts in national and regional newspapers to check whether the companies that are advertising are signed up to the FSA's tough new regulations.
Results show that out of the eighteen main companies that advertise regularly in the press, four are still not signed up to the regulation and are therefore operating illegally. These companies are MPG Investments, Sell It Fast, House Direct UK and Home Savers UK.
Kay Boycott, Shelter director of policy and campaigns, said: "We are shocked to discover some rogue and unregulated companies have the nerve to advertise in national newspapers when they are operating completely outside of the law.
"If almost a quarter of the big firms who are advertising in national newspapers are unregulated, then it is highly likely that many more of the smaller companies are operating completely under the radar.
"Everyday we see struggling homeowners coming through our doors looking for a lifeline and we are extremely concerned people will assume companies advertising in national newspapers are above board when clearly that isn't always the case.
"Shelter highlighted the existence of the unscrupulous and rogue sale and rent back industry over three years ago and will continue to campaign until all companies are signed up to regulation and have improved their practices.
"As a charity, it should not be our responsibility to check whether the new regulation is being enforced and the FSA must get tougher on companies still not signed up.”