With money laundering high on the political agenda following prime minister David Cameron’s pledge to tackle corruption in the capital, Estates Gazette takes a look at how the property industry can do their bit and what the responsibilities are to comply with up-to-date industry regulations.
In this week’s Auction Focus Estates Gazette looks at what the auction houses are doing to up their game and avoid being implicated in money laundering schemes. Tom Bridge, head of residential conveyancing and probate at Stephensons Solicitors, says criminals wanting to dispose of properties may see auctions as a “viable alternative” to private treaty, due to the speed of sales and auctioneers’ typical lack of legal experience, making them particularly “susceptible” to fraud.
Need the rules set out simply? Writing in the Practice & Law section of this week’s Estates Gazette, Andrew Wallis, an associate at Irwin Mitchell, has offered a convenient guide to the UK’s anti-money laundering regime (“A-ML regime”), and what it means for estate agency and property auction businesses that fall under the regulated sector.
Wallis explains: “The UK’s A-ML regime is split into two parts. Firstly, everyone in the UK must avoid committing a set of money laundering offences under sections 327 to 329 of the Proceeds of Crime Act 2002 (“POCA”). Secondly there are those who also owe higher duties by virtue of doing business that places them in the money laundering ‘regulated sector’.”
In order to avoid committing a money laundering offence under POCA, if an individual or business knows or suspects that a transaction may involve criminal property, it can make an “authorised disclosure” to the National Crime Agency to seek its consent to proceed with a transaction. They may even seek consent after a transaction, but this would only provide a defence if it is sought as soon as reasonably practicable and there is good reason for not having done it earlier.
However, for the regulated sector, the Money Laundering Regulations 2007 set out the additional registration, due diligence, systems and controls and training requirements that apply, which include regulated sector-only criminal offences such as “tipping off”.
To read the full article and for more details on the A-ML responsibilities of the property sector, see “Washing hands of dirty money” in the Practice & Law section of this week’s Estates Gazette.
Next week in our Residential Focus we will be publishing the industry’s reaction to what can be done to stop agents falling foul of foreign nationals with questionable sources of income buying into UK property.
