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Survey shows just 12% of agents are fully compliant with AML regulations

6th February 2018

Estate Agents continue to be at risk of fines from HMRC for non-compliance with the Anti-Money Laundering regulations.

Latest research from Landmark, including a multiple choice survey, shows gaps in understanding when it comes to the Money Laundering Regulations. Just 12% of those surveyed scored 100% on questions relating to the existing regulations and changes introduced as part of the 4th Money Laundering Directive (4MLD) in June 2017.

4MLD introduced the requirement to undertake checks on purchasers in addition to vendors. But there is still widespread confusion over the timing of this check where just over 50% of respondents correctly identified that checks on purchasers are required when the buyer’s offer is accepted by the seller.

One of the areas of most concern is understanding the importance of demonstrating a risk based approach.

Estate agents are required to have a process in place to identify the level of risk posed by the individual to the business from a Money Laundering perspective. Each client should be assessed individually and an appropriate level of check applied.

The research shows that while management and business owners demonstrate a good understanding of this, it is not being disseminated to front line staff.

And this is where the research chimes with the recent comments from NAEA chief Mark Hayward that agents continue to face “business busting” AML fines from HMRC.

“Irrelevant to their own knowledge and understanding of the regulations, business owners and management who are not training their staff will be identified and targeted” says Ben Robinson, Director of Agency Services at Landmark.

“When HMRC first contact an agent they will be asking relatively straight forward questions, such as who is the Money Laundering Reporting Officer (MLRO), to whoever answers the phone. If that person doesn’t know the answer it’s not too much of a stretch to assume you may have them knocking on the door soon after!”

Other stand out stats from the survey include

  • 13% of respondents believed a PEP to be a “Property Exempt Professional”
  • 10% of agents believe Trading Standards police the Anti-Money Laundering Regulations, while a concerning 7% believe the now defunct Office of Fair Trading do.

Over the next few weeks in a series of blogs, Ben Robinson will be providing further insight in to the research and reviewing the guidance from HMRC for agents. CLICK HERE TO SIGN UP TO RECEIVE THESE BLOGS

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