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TODAY'S OTHER NEWS

Cost of AML compliance hits £6m for estate agents

The estate agency sector is now paying almost £6m for anti-money laundering (AML) supervision.

Businesses are legally required to register for AML supervision with HMRC, costing £300 per business premises.

However, following this initial registration fee, businesses are also required to pay ongoing annual renewal fees.

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Research by AML checks provider Credas Technologies has found that this fee has risen from £115 in 2017 to £130 in 2018 and £300 in 2019.

The increasing number of estate agencies, from 15,063 in 2018-19 to 19,920 in 2019-20, has meant the total compliance bill for the sector has risen from £1.9m to £5.9m during this period – a 205% increase, according to Credas Technologies.

The only industry to experience a bigger rise is accountancy which has experienced a 41% rise in registered premises leading to a 225% in total fees paid. 

Tim Barnett, chief executive of Credas Technologies, said: “With the UK property industry such a common target for money launderers, it’s great to see that more and more estate agents are fulfilling their duty to become AML compliant, particularly during a period of such heightened market activity when the threat of money laundering is naturally going to be higher. 

“Of course, while this greater compliance is a plus, the sums paid on an ongoing basis may certainly make you wince, particularly given the sharp increase in the fees charged by HMRC in recent years. 

“However, even £300 per branch is a small price to pay in comparison to the huge fines you could be subjected to should you be found in breach of AML regulations. 

“However, despite being a legal obligation, HMRC’s supervision does not provide any of the necessary training or company frameworks required to help prevent your business from being targeted for money laundering and criminal financing. 

"That’s still up to you to implement, but luckily, with the rising capability of technology and automation, doing so is easier and more affordable than ever before.”

Table shows UK industries by biggest rise in number of premises being registered for HMRC AML supervision

Category

2018-19

2019-20

Annual Change

Accountancy Service Providers

12,385

17,436

41%

Estate Agency Businesses

15,063

19,920

32%

Money Service Businesses

37,199

35,509

-5%

Trust or Company Service Providers

2,256

2,781

23%

High Value Dealers

1,338

1,258

-6%

Bill Payment Service Providers

262

328

25%

IT and Digital Payment Service Providers

154

195

27%

Art Market Participants [1]

-

53

 

Total premises [2]

68,657

77,480

13%

Table shows UK industries by biggest rise in estimated total fees paid to HMRC for AML supervision

Category

2018-19

2019-20

Annual Change

Accountancy Service Providers

£1,610,050

£5,230,800

225%

Estate Agency Businesses

£1,958,190

£5,976,000

205%

Money Service Businesses

£4,835,870

£10,652,700

120%

Trust or Company Service Providers

£293,280

£834,300

184%

High Value Dealers

£173,940

£377,400

117%

Bill Payment Service Providers

£34,060

£98,400

189%

IT and Digital Payment Service Providers

£20,020

£58,500

192%

Art Market Participants [1]

-

£15,900

-

Total [2]

£8,925,410

£23,244,000

160%

[1] Art Market Participants not under HMRC AMLS Supervision until 2019-20

[2] From 2019-20 the total number takes into account multi-sector registered businesses, therefore sector breakdowns will exceed total

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