Anti Money Laundering Checks For Property Developers and Firms

Money launderers have become so sophisticated in their techniques that it can be incredibly difficult to spot, but there are a number of red flags to look out for, and for property developers, the main one will be sources of cash. In order to complete the placement and layering stages of money laundering, criminals tend to either break up large sums of dirty cash into smaller amounts. This is done in an effort to hide their original source or use shell companies to move larger sums in an attempt to disguise their own identity. 

So when a client attempts to move a very large sum, or lots of smaller ones – especially if they are using ‘business’ rather than personal accounts - this should be investigated as suspicious.

The key way in which property developers can prevent money laundering is to ensure their customer due diligence is absolutely watertight. This means running full AML checks on all clients – individuals and corporates – to ensure they are who they say they are. Individual checks will identify, verify and screen the individual, while a business/corporate check will verify the business, and identify the key people associated with that business, and – importantly - its ultimate beneficial owner. 

Being able to navigate the opaque and complicated corporate structures financial criminals use to try and hide their activities is absolutely crucial in preventing money laundering, because if an individual has attempted to hide their true identity – and the true source of their funds – through multiple corporate layers and anonymous accounts, you will be able to spot it and stop it.

Hopeful property owners will experience extensive AML checks when buying a house or flat, with these measures being put in place to detect suspicious and illegal financial activity. Failure to comply with AML regulations and responsibilities most commonly results in financial penalties that vary depending on the severity of the offence. While fines are the most common form of punishment, more serious cases can result in prison time. 

Staying up to date with AML checks in the property development sector is, therefore, essential, with SmartSearch helping you to easily streamline your operations to make sure you’re constantly compliant.

Anti-money laundering checks when buying a house can be an exhaustive process if you have not first prepared the documentation that you need. You can enjoy a simpler and streamlined process by preparing valid documentation. ID checks require an in-date passport, a valid UK driving licence or a birth certificate. Meanwhile, a proof of address check requires a recent utility bill, a council tax bill, a recent bank statement or a valid UK driving licence. 

Ensuring your documentation is up-to-date and valid before a timely submission will make sure that your money laundering checks when buying a house are completed swiftly. Paying for a property using cash will result in a more scrutinising AML process, so prepare a robust proof of funds that will answer any questions before they’re even asked by the relevant parties.