I've had a look at that site and Screenplay Agency does not look good. The problem is that the writers that will go for an agency like this are not good enough to get into a "real" agency which is not easy to do.
What a lot of people that yearn for a creative job do not realize is how competitive writing, acting, illustration, ect is. Even being in an elite agency is not guarantee of anything. You have to continue to not only improve your craft and sell yourself. Or your work can be good, even great, but if the market is not looking for what you have, your work will not sell. I know this because we have an illustration agency.
Back to Screenplay Agency. The reason why this agency and others like it will survive regardless of their reputation is that writers who cannot get into legitimate agencies will hope against hope that they will have a chance if they have an agent -- any agent.