All UK letting agents are required from today to check landlords, tenants and other clients against the UK’s official sanctions list.
If a match is found or suspected, agents must report it to the Office of Financial Sanctions Implementation (OFSI).
Sanctions checks are already a standard part of Anti-Money Laundering (AML) due diligence, but for the first time, these checks will now be a separate legal requirement in their own right.
Guidance from Propertymark defines a sanctions check is a screening process used to determine whether a person or organisation appears on a government or international sanctions list.
These lists may include individuals or entities linked to money laundering, terrorist financing, human rights violations, organised crime, or political corruption and other national security threats.
If a person or company is identified on the UK sanctions list, or if there is reasonable cause to suspect they are, the agent is legally required to freeze any property or assets and report the matter to OFSI immediately.
From today letting agencies are defined as “relevant firms” under the UK’s updated financial sanctions regulations, meaning they are subject to the same duties as estate agents, law firms and financial institutions in terms of identifying and reporting designated persons.
In detailed practical terms agents must check tenants and landlords against the UK sanctions list; freeze any assets or property held for a sanctioned individual/entity; report any matches or suspicions to the OFSI immediately; and keep records of checks and any actions taken.
To get further information there is The UK Sanctions List published by the Foreign, Commonwealth and Development Office along with The OFSI Consolidated List of Financial Sanctions Targets.
For further information on this subject read the government’s General Guidance to UK Sanctions.
In response to the start of the new regulations, Nishma Parekh – Goodlord’s director of referencing – comments: “Every single landlord and tenant, no matter the rental value, must now go through sanctions checks. With four in five landlords feeling unprepared for the changes, it’s vital that they get their ducks in a row immediately if they want to stay on the right side of the law. If they fail to comply – even if it’s a genuine mistake – they could be facing unfathomable fines of up to £1m.”
This article is taken from Landlord Today