Once again, estate agents unfortunately find themselves in the spotlight for compliancy failures with 68 firms collectively fined more than £500,000 for breaching anti-money laundering requirements.

The fines announced this week followed the first prosecution of an estate agent for trading despite not registering with HMRC, to ensure compliance with money laundering regulations.

“This latest round of fines and ongoing pattern of non-compliance clearly shows the urgent need to improve standards in the sector,” said Martin Cheek, managing director of SmartSearch.

Cheek believes that HMRC’s decision to name the 68 estate agents that have been fined a total of £519,645 for not complying with rules designed to stop criminals laundering money from illegal activity is also “a wake-up call” to all regulated businesses with a total of 175 firms receiving fines totalling a hefty £2.1m.

He continued: “As HMRC continues to take action against those who ignore their legal responsibilities, it almost becomes a question of when not if for those who lack fundamental AML processes. Without doubt, the case for digital onboarding, electronic verification and enhanced due diligence has never been so vital.

“Especially in the current climate where sanctions are growing and more than £90 billion is being laundered through the UK, the property sector finds itself on the front line in the war against money-laundering. The sector has long been a target for criminals and exposed persons to filter dirty money and an urgent response is needed.”

Cheek added: “Rising to the challenge will undoubtedly a take a culture change to not only be aware of the potential threats, but to take advantage of the latest innovations and technology available to make AML and sanction procedures efficient and far more robust.”

Adam Watts of Veriphy, an online compliance solutions provider, believes that the action taken against the 68 agents, following on from penalties given to 41 agents in May, offers powerful evidence of a clear determination by HMRC to close down money-laundering loopholes and tighten up procedures throughout the regulated sector, and in particular the housing market.

He said: “Any estate agency that thinks it can ignore the regulations and avoid correct procedures is playing a very dangerous game. HMRC are hitting non-compliers hard and fast, so now is the time to be serious about aligning with the rules and fighting back against money launderers.”