Nearly a quarter of estate agencies would not pass anti-money laundering spot checks, claim

A significant number of estate agency businesses would struggle to pass an anti-money laundering spot check, while nearly a quarter could be breaking the law because they don’t have an AML officer in place.

That’s the warning from identity verification business Credas, which polled 100 estate agency businesses.

It found that 22% of those businesses didn’t have an AML officer and processes in place, despite risking potentially large penalties from HMRC for failing to comply with regulations.

Credas also claimed that of those surveyed, businesses spend an average of four days per month completing AML checks, with one of the main barriers to completion being cited as getting hold of clients.

On average, the businesses it spoke to listed 150 properties a month across their branches, taking an average of two and quarter hours to undertake the AML verification process for each listing.

Earlier this week, EYE revealed that HMRC could soon start naming and shaming the non-compliant firms it has fined.

Rhys David, chief executive of Credas, said: “Since the introduction of the directive in June last year, the industry has had little support or guidance on how to implement the required checks.

“I feel for these businesses because of the extra administrative burden, but unfortunately, as it stands, they could be breaking the law by not having an AML officer in place.”

He warned estate agents: “Now is the time to get your own house in order.

“It is more than six months since the AML directive was implemented, yet our research shows that unfortunately many businesses would fall foul of the law if they were spot-checked.”

Credas launched in May 2017 as a way to verify someone’s identity using facial recognition technology.

It paid estate agency businesses to take part in its OnePoll survey, which was conducted in December.

Mark Hayward, chief executive, NAEA Propertymark said: “It’s sad to see that even with publicity, some agents are still ignoring the importance of anti-money laundering procedures and the compellingly need for compliance If agents don’t have a money laundering reporting officer, they’re breaking the law.”

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4 Comments

  1. Rob Hailstone

     
    One of our member firms this week received a request from an estate agent to complete an AML Reliance Form. Extracts set out below:
     
    Confirmation of Verification of Identity
     
    Reliance Given by SRA Regulated Law Firms or Solicitors
     
    We confirm that:
     
    The information given above was obtained by us in relation to the customer
     
    The evidence we have obtained to verify the identity of the customer, tick one:
     
    Meets the standard requirements of the SRA Code of Conduct and the Law Society Guidance on Anti Money Laundering and terrorist financing
     
    Exceeds the standard evidence (written details of the further verification evidence taken are attached to this confirmation).
     
    We give consent for Xxxxxx Xxxxxxxx to place reliance on Money Laundering Due Diligence undertaken
     
    Needless to say this request was refused. Should agents be sending out a form like this? As one BLG member said:
     
    “Perhaps the solicitor should send the same form to the agent and ask them to complete it as well.
     
    After all, the estate agent meets the sellers so is best placed to check the sellers/buyers are who they say they are.  An extra line of defence against property fraud maybe.”
     

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  2. ArthurHouse02

    This report is bonkers. 100 branches listing 150 properties a month, so 1.5 properties per branch, and over 2 hours Money Laundering checks per property. These branches arent going to be open long enough to worry about spot checks

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  3. jeremy1960

    Feel the pain estate agents,  we letting agents have for the past couple of years but with the added issue that gov and a few tree hugging lobbyists dispute that we should be paid and should do everything for free! Every year gov introduce new legislation and more paperwork with penalties for not completing but still consider letting agents as charities.

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  4. femaleNeg8804

    I think most companies have done this for best practice any way, I’ve been doing my job for about 12 years now and I’ve always taken I.D and proof of address for everyone. I think the number of dodgy agents still taking cash behind closed doors has made this profession one which is not respected and is untrusted. There for we are now all suffering because we cant be trusted to do the right thing.

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