Uncertainty surrounds anti-money laundering regulations

Anti-money laundering

Almost one year on from the new AML directive coming into force, how have auctioneers have interpreted the rules.

It used to be easy for investors to turn up at an auction unprepared and buy a property without having to demonstrate that their money came from a legitimate source.

“You could walk in from the back of the room, a complete stranger; you were reading the catalogue for the first time; you had done no homework; you just put your hand up,” says Gary Murphy, partner and auctioneer at Allsop Residential. “We’ve sold multimillion-pound properties this way.”

Today, it is much harder for investors to buy property on a whim like this. Since the introduction of the Fourth Anti-Money Laundering and Terrorist Financial Directive in June last year, the rules have become much stricter. Investors have to be ready to face due diligence and anti-money laundering (AML) checks on the day of the auction.

Almost a year after the regulations came into force, property auction houses have all adapted their policies but significant differences remain between firms as to their interpretation of the rules.

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