Money laundering continues to dominate the news, and with it comes increasing panic from property firms scrambling to deal with the threat of an HMRC investigation.
The property sector is increasingly turning to technology to meet its compliance obligations, yet as the risk of money laundering has evolved, so too have the digital tools available to tackle it.
For property professionals, it’s a huge amount of work to stay compliant while keeping admin from rocketing. Forward-thinking agents know that relying on human judgement alone for anti-money laundering (AML) is risky. A November 2021 report from agency Landmark reveals 58% of agents think current processes are “prone to human error”.
But even agents who have grasped the nettle and adopted electronic AML systems can find themselves unprotected by choosing the wrong tech. Older, legacy platforms screen for politically exposed persons (PEPs) and sanctions through database checks – but this is just a fraction of the full picture of AML.
HMRC now requires the collecting and verifying of ID documents, verifying source-of-funds when acting for purchasers and validating the ultimate beneficial owner if a company is buying or selling.
Recent tech developments – such as open banking, cryptographic and biometric verification and real-time ongoing PEPs and sanctions monitoring – can help property businesses automate this collection.
By adopting a digital solution incorporating these features, plus know-your-client, AML and source-of-funds verification for individuals and corporates, agencies can be confident they are compliant while delivering a simple output report that acts as an audit for HMRC.
Many prominent agents, including Knight Frank, Strutt & Parker and Winkworth, have gone digital, turning the headache of compliance into a competitive advantage.
Agents need to be sure their technology covers all the bases now required from HMRC – while of course making sure that the added admin will not slow down colleagues from closing more deals.
Olly Thornton-Berry is co-founder and managing director of AML tech provider Thirdfort