The Fifth EU Money Laundering Directive (5MLD) is due to be transposed into domestic law today The Directive also specifically endorses the use of electronic ID verification, and states that it should be used wherever available. The new directive places an increased importance on the acceptable use of electronic verification methods in confirming identity, without the need for passports or utility bills.
Money-laundering regulations affect a wide range of businesses in the property sector including lenders, estate agents, brokers and conveyancers. The new Directive will further expand this to letting agents for high-value properties.
Failure to comply with the regulations can result in prosecution and heavy financial penalties.
Martin Cheek, managing director of SmartSearch said “Although we’ve yet to see final details, the new money-laundering regulations are bound to have a serious impact for large numbers of firms in the UK and across the EU.
“We have called on the Government to publish the final rules without delay so businesses can prepare more effectively and ensure they are compliant. In the meantime, our ‘Top Five’ guide is aimed at giving them a bit of a helping hand.”
SmartSearch says that there are five changes for businesses that are likely to be affected by the regulations:
The Legal Sector Affinity Group has published a summary of changes to the regulations, which includes:
• A duty to collect proof of registration for entities, such as trusts and companies
• A duty to inform the registry of any discrepancies in their information
• Changes to client due diligence and enhanced due diligence
Late last year it was revealed that a fifth of law firms were failing to comply with existing anti-money laundering rules,
