Your understanding appears to be the same as mine, I figure it allows us to recover from the LL when for example if the LL and tenant live in the same property and the LL delays advising us that the tenant had vacated.
I think it’s to stop the LL reporting the change late (as they could have known and have a duty to report) carrying on receiving payments and then being excluded as a recovery target.
However, i stand to be corrected by Peter, or Kevin etc…
However, in my example I think 101(2) would override this as the LL would be the person that failed to report the material fact. I think based on this reg 101 becomes pretty much obsolete as all people on the claim whether they be the claimant and partner etc or the person receiving the payments will be caught by reg 101(2).
One day I hope to understand this 👿