Agents are being told by a trade body to conduct more frequent risk reviews and check purchaser identities against up to date sanctions lists released by the government.
The Guild of Property Professionals’ compliance chief, Paul Offley, says: “With regard to financial restrictions things are moving very quickly, so agents need to apply more frequent on-going monitoring to make sure they are following the correct procedures with the most recent information.
“If they haven’t already done so in the wake of the current events, agents should be reviewing their initial risk assessment.
“Be aware that UK government has taken steps to effect restrictions from undertaking financial transactions involving the Central Bank of the Russian Federation, the Russian National Wealth fund and the Ministry of Russian Finance. It is vital to review all transactions and take the necessary steps if you believe you have a specific case.”
He adds that all client identity information should be checked against the UK Sanctions List, which has been expanded on a daily basis over the past week.
“If need be, request additional identity information to ensure you do not have a false-positive identification and you can more accurately rule out the possibly that the individual or entity is from a country on the UK Sanctions List” he suggests.
HM Treasury’s Office of Financial Sanctions Implementation provides a consolidated list of all persons and entities that are subject to sanctions which are effective in the UK.
Offley adds: “If an individual or entity you are dealing with matches the information on the consolidated list, the transaction must be suspended, and the matter should be reported to either your money laundering reporting officer or your money laundering compliance officer.”
According to Offley, agents will need to keep a record of the fact that they have gone through the correct procedures and performed the appropriate checks.
“It is important that agents are able to show they have performed their due diligence and taken the necessary steps should they find themselves dealing with an individual or entity that appears on the sanctions list” he concludes.
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I have heard all sorts of excuses for NOT carrying out Client Due Diligence eg “we don’t handle client money so we don’t need to” or “isn’t that the lawyers’/bank’s job?”.
There’s very good guidance on GOV.UK
Just search “guidance of estate agents on money laundering from HMRC”.
If you haven’t read it, you must.
You shouldn’t dream up ways to avoid this, or pay lip service to the requirements or you could find yourself arrested and prosecuted.
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