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MONEY LAUNDERING REGULATIONS 2003
The Money Laundering Regulations 2003 came into force on 1 March 2004. Estate agents must comply with the Regulations. The legislation imposes obligations on both organisations as well as individuals. Whilst it is not currently a requirement for Letting Agents to comply, it was considered good practice for Movingspace to extend the scheme from the Sales Department to now include the Letting Department to alleviate complications where a Landlord subsequently instructs us to sell their property.
The Money Laundering regulations require that we see proof that the client is who he or she claims to be and must take reasonable steps to find out who our clients are by requesting sufficient evidence of their identity. We will therefore ask you for two verification documents, one to identify the name of the client, preferably a document, which has a photograph of them such as a passport and a further document to confirm their residential address, such as a recent utility bill.
We are legally obliged to establish to our satisfaction that we are dealing with a real person or organisation. If we do not receive satisfactory evidence of identity, we must stop the transaction.
SCHEDULE OF ACCEPTABLE DOCUMENTATION
In general:
• original documents must be inspected and either copies or details of the document are taken for your records. Certified copies are acceptable and must be dated and signed “original seen” by the certifier.
• you must ask to see at least 2 forms of identification.
• verification of client identity is risk based. The extent of the identification evidence required will depend on the nature of the work you are asked to undertake and the assessed risk.
UK individuals
You must verify the name and residential address of the individual where he or she can be located. You must ask to see one document from each of the columns below (please note that for the purposes of verifying an individual’s address PO Box numbers and addresses listed c/o (care of) are not permitted):
Identity documents Evidence of address
- Current signed passport - A utility bill issued within the last three months (but not mobile phone bills as these can be sent to different addresses)
- Current UK photo card driving licence - Local authority tax bill (valid for the current year)
- Current full UK driving licence (old version) – but old style provisional driving licence should not be accepted
- Bank, building society or credit union statement containing a current address
- Residential permit issued by the Home Office to EU Nationals on sight of their own country passport
- The most recent original mortgage statement from a recognised lender
- Benefit book or original notification letter from the Benefits Agency confirming the
right to benefits
- Current UK driving licence (old full licence or new photo card licence) if not used for evidence of name
- Self-employed in the construction industry – tax exemption certificate with
photograph of holder (forms C155, C156 or SC60)
- Confirmation from the electoral roll that a person of that name lives at that address
- Inland Revenue tax notification - Record of home visit
- Firearms certificate
UK Trusts
Extra care must be taken in the verification of trusts as they are popular vehicles for criminals wishing to avoid the identification procedures and hide the true origin of the money they wish to launder. The following documents are required (as many as possible):
- Constitutional documents establishing the trust
- Details of all the trustees and beneficiaries and a copy of the deed evidencing the
appointment of the current trustees
- Verification of the identity of those who have control over the funds i.e. the principal trustees and the providers of the funds i.e. the settlor (except where deceased) and the principal beneficiaries
- Where the settlor is deceased, written confirmation for the source of the funds should be obtained, for example, grant of probate or copy of the will creating the trust.
UK Corporates and partnerships
Only normal commercial checks and due diligence and required where the company is FSA authorised or where it is listed on the London Stock Exchange or another recognised UK investment exchange or is a subsidiary of such a listed plc. No further evidence is required.
In other cases, the following documents are required. As a minimum, a certificate of incorporation, evidence of authority of any individual and the verification of the identity of the individual should be obtained.
- Original or certified copy of the certificate of incorporation or a search at Companies House
- The latest report and accounts (which, if possible, should be audited)
- Evidence that any individual representing the company has the authority to do so (for
example a resolution of the Board of Directors)
- Where the directors of the company are not known to the firm, the identity of at least two executive directors, or the company secretary and an executive director, or the majority shareholders should be verified as for an individual client
- Where it is not possible to obtain the above, a credit reference agency search should be made or a banker’s reference taken
Occupational Pension Scheme
- Obtain the identity of the Principal Employer and the Trust
- Verify the identity of the Principal Employer in accordance with the general rules relating to corporates
- Review the formal documents concerning the Trust to confirm the names of the current trustees and their address for correspondence
Registered charities in England and Wales
- Obtain the charity’s registered number
- Request the name and address of the Charity Commission’s correspondent for the charity from the Charity Commission
- Verify the identity of at least two signatories for the charity on an ongoing basis Local Authority
- Resolution of the Council authorising the opening of the account or the undertaking of the relevant investment
- Seek and retain evidence of the official authority to act
Non-UK individuals
You must verify the name and residential address of the individual where he or she can be located. You must ask for one document from each of the columns below:
Evidence of identity Evidence of address
- Current full valid passport - A utility bill issued within the last three months
- National identity card - Bank or building society statement
- Driving licence - Obtain a reference from a bank, legal or other professional who has advised the individual for the last two years
Non-UK corporates
- Original or certified copy of the certificate of incorporation from the relevant companies registry
- Evidence that any individual representing the company has the authority to do so
- Where the directors of the company are not known to the firm, the identity of at least two executive directors, or the company secretary and an executive director, or the majority shareholders should be verified as for an individual client
- Obtain a reference from a bank, legal or other professional who has advised the corporate for at least two years
Non-EU Credit and Financial Institutions
- Confirm the existence and regulatory status of the institution with the home country central bank or financial service regulator
- Check with a subsidiary or overseas office of the verifying firm or a correspondent bank in the same country
- Check with an EU regulated correspondent bank of the overseas institution
- Obtain evidence from the institution of its licence or authorisation to carry on financial
and/or banking business
- Unregulated credit and financial institutions should be verified in accordance with the
procedures for other non-financial companies
- Obtain a reference from a bank, legal or other professional who has advised the institution for at least two years
Useful Contacts
To notify a suspicion, or for advice on money laundering and financial investigation, contact:
Economic Crime Branch
National Criminal Intelligence Service (NCIS)
PO Box 8000
London SE11 5EN
Tel: +44(0)20 7238 8282
Fax: +44(0)20 7238 8286
Website: www.ncis.gov.uk
For advice, ordering the anti-money laundering guide and other material such as posters and educational videos:
HM Customs and Excise
National Advice Service
Tel: 0845 010 9000
The anti-money laundering guide is also available on www.hmce.gov.uk
For High Value Dealers who need to register:
Commissioners of Customs and Excise
HM Customs and Excise
Banking Group
Alexander House
21 Victoria Street
Southend on Sea
Essex SS99 1AG
For more detailed advice about identification of companies/trust and to order the Joint Money Laundering Steering Group guide:
BBA Enterprises Ltd
Pinners Hall
105-108 Old Broad Street
London EC2N 1EX
Tel: +44(0)20 7216 8800
Website: www.bba.org.uk/public/services/publications/63459?field=purchasedetails
To check the names of new clients against list of known terrorists the following websites may be of use:
www.bankofengland.co.uk/sanctions
www.treas.gov/offices/enforcement/ofac/sdn/index.html
www.fbi.gov/mostwant/terrorists/fugitives.htm
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