New agent-to-agent anti-money laundering check launches to solve London problem

LonRes, the property platform to which over 6,000 London agents subscribe, has launched ResCheck, a new agent-to-agent anti-money laundering (AML) compliance service.

In London it is common for agents to share instructions through LonRes.

Last summer, there was a highly charged meeting put on by the NAEA for London agents, where delegates were told that if they were sharing instructions, they must not share AML checks on clients with each other, and must also do due diligence on each other.

Following the meeting, talks were held with HMRC on compliance in a part of the industry where using sub-agents is common.

Today, LonRes announced its new venture, in association with city law firm (and AML specialist) Eversheds,

LonRes said the launch of ResCheck follows detailed AML discussions with HMRC.

ResCheck’s focus lies specifically on the compliance-based obligations a sub-agent has in carrying out due diligence on a head agent (or lead agent) prior to viewing a property.

Subscription to the ResCheck service ensures that a sub-agent is fully compliant with these due diligence obligations.

ResCheck is a paid-for online service, managed by the LonRes compliance team who carry out comprehensive AML checks through leading provider Creditsafe, and secondary verification checks in-house.

Once approved, subscribers receive a ResCheck Compliance Certificate valid for 12 months enabling them to safely carry out business with other ResCheck-approved members.

In addition, LonRes, together with Eversheds, has joined forces with Cigna, a provider of specialist insurance services, to offer an optional insurance policy against legal fees should an HMRC compliance investigation prove necessary.

LonRes director Anthony Payne told EYE that HMRC appeared to have dropped its rule that lead agents must perform AML checks on lead agents. He also said that it was not necessarily the case that sub-agents would not be able to accept the lead agent’s checking of clients, and would have to perform their own checks.

He said that it was all about risk, and that a sub-agent should make their own judgement, when coming up to the point of sale, they should ask to see the lead agent’s AML checks. If the sub-agent felt these had been inadequate, they should then make their own checks.

Payne added:  “Complying with the UK’s Money Laundering Regulations is a requirement for all estate agents.

“However, client due diligence surrounding head/sub agents is complicated.

“HMRC states that the onus is on the sub-agent in carrying out appropriate due diligence on the head agent prior to viewing a property.

“At LonRes we want to ensure that our subscribers not only understand their ongoing obligations, but are supported in complying with their due diligence obligations.

“Through detailed discussions with HMRC, LonRes together with AML specialists at Eversheds have designed ResCheck to better inform and protect the businesses we work with.”


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