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Agents failing to do AML checks on business contacts - warning

Regulated firms, particularly estate agents, who take on new business clients are leaving themselves exposed to serious red flags by not completing critical verification checks, new survey data has uncovered.

Research by anti-money laundering (AML) platform SmartSearch found 59% of regulated firms such as solicitors and estate agents fail to carry out checks on businesses they work with.

Only 40% said they ‘often’ identify the owners and the directors of the business, for example, rather than in every case.


Property firms, including estate agents were most likely to skip this critical step, with 65% of firms admitting they do not always carry out verification checks on new business clients. 

The remaining firms across the legal, finance and accountancy sectors all reported similar results, with around 58% of respondents not always verifying identities.

The same survey also found that as part of checks, only 37% of regulated firms actually identify the ultimate beneficial owners (UBOs) – a drop from more than half (53%) in the previous year’s survey. This is despite all regulated AML firms being required to determine the ultimate beneficial owner of any business they have dealings with. 

Martin Cheek, managing director of SmartSearch , said: “There’s no question that KYB processes can be the most complex part of compliance, but given the significant red flags businesses are exposed to, it is also one of the most critical.

“Given the clear requirements of regulators, advancements in technology can help streamline this process considerably and help firms complete such checks. Now is the time to take action to not only protect the business from serious financial crime, but prevent any intervention from the regulator.”


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