- October 31, 2019
- Posted by: FinancialCrimeServices
- Category: News
As regulation to prevent money laundering in the real estate industry continues to increase, we discuss the importance of AML compliance and the measures agents should be taking to prepare themselves for an HMRC inspection.
Clamping down: in 2018-19, HMRC issued 131 penalties worth over £1.2m and secured 30 AML convictions.
In 2016, Property Week did an investigation into HMRC’s regulations and the level of compliance in real estate. The article ended with a warning: “The government’s desire to catch you is stronger than ever.”
This desire appears only to be getting stronger. Money laundering experts have reported an increase in regulatory checks into agents from HMRC in the past few months.
In spring, the government announced that 50 estate agents were being targeted by HMRC, leading to Countrywide paying a £215,000 fine. A spokesperson told Property Week that estate agents “should be under no illusion that we will take action, as clearly shown by our intensive crackdown against money laundering in the sector earlier this year”.
Property professionals are taking heed. The cost of turning a blind eye to dirty money is high, potentially leading to unlimited fines and prison time of up to two years. “It’s been a real wake-up call for the sector,” says Jerry Walters, managing director of Financial Crime Services. Walters’ company carries out compliance checks that predict what HMRC would find if it were to investigate an agency. According to Walters, HMRC is carrying out “a double-pronged attack”, first writing to agents and asking them to produce certain documents and then visiting their premises.