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HMRC - Money Laundering Q&As

Below are some general Q&A's that agents may find useful in everyday scenarios when dealing with clients and consumers. INEA held a meeting in central London - 24 April 2014

On 1 April 2014 HM Revenue and Customs (HMRC) became the supervisor of Estate Agency Businesses under the Money Laundering Regulations 2007.

 

Useful senior HMRC contacts in relation to estate agency money laundering compliance.
Brian Garcia Head of AML compliance
030 0058 5932
brian.garcia@hmrc.gsi.gov.uk
Graham  McGinnigle
West of England and Wales
Operations Manager

0161 261 5117
graham.mcginnigle@hmrc.gsi.gov.uk
Susan Edwards Deputy Head of Compliance
AML Supervision Team
030 0059 0650
susan.edwards4@hmrc.gsi.gov.uk
Estate Agents must register for money laundering and the above contacts can help with queries and also deal with complaints in respect of property people and agents carrying out questionable practices

Money Laundering
Regulations Q&A's

 

Q1. Can out of date passports be used to verify
identity
as part of customer due diligence (CDD)?

In general out of date passports are not a good source of documentary evidence due to the age of the photograph and thus its value in verifying identity is reduced. However, if the client has no other in-date photographic document as listed in HMRC’s guidance, and the client is clearly recognisable from the photograph, its use may be considered along with a variety of other documents suggested in HMRC’s anti-money laundering guidance on a risk based approach. Its use may require agreement by a senior member of staff and it would also affect on-going monitoring as it would need to be refreshed sooner than in-date documents.

Q2. Many OAPs do not have picture ID as listed in
HMRC’s guidance. What can be used instead?

HMRC has listed alternative documents that may be used in our guidance. You may also want to consider that an entitlement letter from the DWP, or a letter from the DWP confirming that the person is in receipt of a pension, could provide evidence of identity. If this is not available, or is inappropriate, a letter from an appropriate person, for example, the superintendent of a care home, may provide the necessary evidence.

Q3. Can I use a copy of a utility bill for CDD purposes?

No. Only original bills or letters may be used. Copies or computer print outs may not be used. Q4. What CDD do I need to carry out on clients that I know personally? Even though a client may be known to you prior to becoming your client CDD must be carried out in line with your policies and procedures.


Q5. When does a business relationship begin?

At the latest a business relationship begins when you enter into a contract with your client to sell their property. However, it may begin earlier than this depending on the services offered, for example, when agreeing an appointment to measure and photograph the property.

Q6. I have a corporate client from outside the EEA, what CDD do I have to carry out?

You must first verify the identity of your client:

• search the relevant company registry and record the company registration number with a copy of the company’s Certificate of Incorporation and confirmation company’s listing on a regulated market if appropriate

• business and registered office address

• directors’ names (or director equivalent)

• beneficial owners’ names (individuals who own or control over 25% of its shares or voting rights) and/or the names of any individuals who otherwise exercise control over the management of the company.

The obligation to verify the identity of a beneficial owner is to take a risk-based approach and implement adequate measures so that you are satisfied that you know who the beneficial owners are, for example, you may:

• make use of records of beneficial owners in the public domain (if any exist)

• require evidence of the beneficial owner’s identity on the basis of documents, data or information obtained from a reliable and independent source

• in some low risk situations, confirm any beneficial owner’s identity based on information supplied by your client. This must be provided in writing with confirmation that they are known to

your client. Some factors may increase risk and require enhanced CDD, for example, if the company or beneficial owner is based in a jurisdiction of concern (http://www.fatf-gafi.org/topics/high-riskandnon-cooperativejurisdictions/) or the beneficial owner is a ‘politically exposed person’. You will then need to consider what additional verification may be necessary. If documents provided are in a foreign language, appropriate steps should be taken to be reasonably satisfied that the documents in fact provide evidence of identity.


Main Link to: HMRC Estate Agency AML guidance


* If you cannot verify the identity of your client or of any beneficial owner you must not enter into the business relationship.





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