New Money Laundering Regulations to Impact Estate Agents – Act Fast!
From the 26th of June 2017, the new UK Money Laundering Regulations 2017 (“MLR2017”) came into force placing new legal and regulatory requirements on Estate Agency Businesses (EABs). The MLR2017s are an amendment to the current legislation which has been in force since 2007.
ALL EABs must comply with these requirements which also bring into force a new statutory regulator which will regulate all EABs from both a financial crime and conduct perspective. Any EAB which fails to comply with the complex regulations will face financial and legal penalties from both a company and individual level.
Unfortunately, everyone (including us) used the final published draft as the, well, final rules, but there were 4 major changes in the final legislation laid before Parliament on the 22nd June. Additionally, a lot of professional “advisers” have got all in a fluster about the risk assessment and reporting, that many have missed the fundamentals.
Key impacts relating to EAB under these new regulations include:
- The regulations are much more prescriptive
- Purchasers as well as vendors are now included in CDD
- Risk Management and Risk Assessment are central and must be documented
- Information requested of other firms must be provided within two days
- Training is the responsibility of senior managers and must include data protection
- Reliance is extended and now includes other EABs
- Politically Exposed Persons (PEP) definitions have been extended
In order to comply with these regulations and avoid financial and legal penalties, EABs will have to:
- Build a robust and effective AML Governance Framework
- Increase personal accountability by appointing a suitably skilled Nominated Person
- Carry out and embed a Risk Management process within the firm
- Ensure policies, procedures and controls relating to AML and Financial Crime are fit-for-purpose and are regularly reviewed
- Ensure Customer Due Diligence is carried out and is effective on both purchasers and vendors
- Ensure all staff are regularly trained in relationship to AML
Most EABs are not in a position to conduct this radical change to their previous arrangements, and this is where Compliance Consultant can help.
Compliance Consultant is an expert provider of shaping, designing and implementing CDD and AML and target operating models for EABs. Our experience includes:
- Previously appointed as a skilled-person by the regulator
- Compliance Health-checks across sales and compliance risk
- AML Health Check and Framework Review
- AML Target Operating Model
- CDD Utilities and operating models
- AML Policies & Procedures
- Change Programme Design & Management
- Provide governance templates and integration models.
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