HMRC names agencies breaching anti-money laundering processes
The list of those breaching the rules include Landmark Sales & Lettings Limited in Reading, which is said to have failed to conduct due diligence and timing of verification. The agency was given a £5,250 fine.
And Robert Holmes, an agency in Wimbledon, south west London, was fined £6,591 for “failures in having the correct policies, controls and procedures; internal controls; conducting due diligence and timing of verification” according to the HMRC.
A money transfer firm run by a former agency – MR Global – was fined a record £23m, although this was not connected with agency activity.
Nick Sharp, deputy director at HMRC’s fraud investigation service, says: “Money laundering is not a victimless crime. Criminals use laundered cash to fund serious organised crime, from drug importation to child sexual exploitation, human trafficking and even terrorism.
“We’re here to help businesses protect themselves from those who would prey on their services. That includes taking action against the minority who fail to meet their legal obligations under the regulations as this record fine clearly shows.”
Now the Guild of Property Professionals believes it is shocking that while HMRC’s public list named only four companies, two were agents.
Guild compliance office Paul Offley says: “This is another warning to the industry that firms must have a clear Anti Money Laundering strategy for their businesses, regardless of the business size, transaction levels or whether they know every single customer they deal with if they want to avoid any financial or reputational damage to their business.”
He says different agencies will employ different methods of completing AML verification with clients.
“However it is important to remember that if you chose an electronic provider route, then firms still has to ensure that they have policies, procedures and controls in place; they still have to have completed a business risk assessment, they still need to demonstrate the training they undertake with their teams, they still need to ensure that any ‘high risk’ assessment case receives enhanced due diligence, they still need to have a process for ongoing customer due diligence – and for every single seller or buyer they must be able to demonstrate they have completed a risk assessment; completed verification checks, checked on PEP and Financial Sanctions status – all before a business relationship commences” he insists.
“Having the right procedures in place will assist in eradicating the practice of money laundering through the UK’s property market, and secondly it will protect agents and their business from being linked to criminal activity.”
“Estate and lettings agents need to be able to demonstrate the correct AML procedures in the event of an unexpected visit from HMRC. It is crucial that every agent, whether in sales or lettings is up to date with the latest changes to the regulations and ensures that their business policy is regularly reviewed to ensure it falls in line with the latest requirements” Offley concludes.