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Money laundering update: New obligation could create ‘insurmountable problems for agents’


There is no doubt that if the obligation to ID buyers is included in the new Money Laundering Regulations, it will create insurmountable problems for agents.

The claim comes from compliance expert and ex-Trading Standards officer David Beaumont.

He said: “The idea of checking the identity of buyers is basically a good one, but lawyers do it during the conveyancing process.

“To place a duty on agents to do it as well makes no sense.

“Where any statutory duty exists, control over compliance to that duty must be in the hands of the person with the duty. Agents have little or no control over buyers and so breaches of the duty will occur and the agent will be able to do nothing about it!

“Given that penalties are issued by HMRC for breaches, I find it hard to believe that there are no other voices putting forward the arguments against it?

“We have argued against this for a long time, because of the problems involved, whereas the professional bodies have been promoting it as best practice!

“It is not best practice and it should never have been considered as appropriate for inclusion in the new Regulations.

“The NAEA and RICS should have been fighting to ensure it was never considered as appropriate, but instead they were promoting its inclusion. They appear to have no understanding of the profession they represent, and the challenge for them will be to justify their stance.

“The logic is simple: currently, if a seller refuses to provide ID to their agent, the agent refuses to accept the instructions and does not market the property. No breach of the Regulations can therefore take place.

“If this proposal is implemented, what will an agent be able to do if a buyer refuses to provide ID? Nothing. This means the agent will be in breach of their statutory duty.”

This is only one of nine specific problems that Beaumont, of Compliance-Matters, a compliance consultant for agents, has identified.

If you want to see his views and his outline of all the problems click HERE

Beaumont also runs EYE’s free compliance helpline, exclusively for our subscribers. You can call it on 0161 727 0798.

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