The fast-moving property sales market is increasing the risk of fraud, an anti-money laundering expert claims.
Olly Thornton-Berry, co-founder of risk management platform Thirdfort warns agents can’t just rely on manual database checks and need the right tools in place to cut fraud risks amid the rise of quickfire sales.
He highlighted Rightmove data showing it takes just 31 days on average to find a buyer, a record low and down two days from April’s 33 days.
Overall, time on the market has dropped nearly two thirds in two years from an average of 88 days in May 2020, and by more than eight days from May last year.
He said it is still important that property professionals take time and ensure they do accurate know-your-client and anti-money laundering checks.
Thornton-Berry said: “Fraud is a huge problem in the UK property market.
“Impersonation fraud is up 120%. Payment scams are projected to cost £1.5bn. Money laundering costs the UK economy some £100bn.
“Quick sales only increase this risk. For property professionals, it’s an enormous amount of work to stay compliant while keeping admin from skyrocketing.
“But even agents who have grasped the nettle and adopted digital tools can still find themselves unprotected by choosing the wrong tech. Older, legacy platforms are not up to scratch – especially when the pace of house sales is increasing.”
Thornton-Berry said agents need to do much more to protect their businesses and avoid HMRC fines for non-compliance with AML requirements.
He said: “When the risks of fines are so great, manually tackling the ever-increasing compliance burden not only exposes agents to greater risk but cost as well.
He suggests that new developments such as Open Banking, cryptographic and biometric verification, and real-time ongoing politically exposed persons and sanctions monitoring can help property professionals automate compliance requirements, reducing the risk of fraud.
Thornton-Berry added: “When there are already so many ways to fall foul of money laundering regulations, agents need to be sure the technology they adopt covers all the bases now required from HMRC while helping reduce the admin burden.”