ARLA Plans New Anti-Money Laundering Landlord Resources

As Letting Agents and Landlords face changes from the new, EU Fifth Money Laundering Directive that came into law on January 10th, ARLA Propertymark is planning to make a number of new resources available to agents and landlords to help ensure they are abiding by the updated legislation.

The new regulations have been implemented to further strengthen anti-money laundering rules in the UK, to include letting agents. The updated rules include a number of changes for UK landlords and agents to show they and their clients are all acting within the law.

How the updates to the fifth directive affect UK landlords and agents

There are a number of new updates to the fifth directive that letting agents and landlords most follow to ensure they’re acting within the law when they manage properties for their clients. The new rules are listed below.

1. Where a monthly rent is equal to 10,000 euros or more, letting agents must carry out their own, thorough, customer due diligence. This is to ensure the agent is confident the letting agreement is legitimate and not part of a money laundering process.
2. Letting agents must take the time and reasonable measures to understand the control and ownership structure of the legal person, trust, company, foundation or other legal arrangement of their customers.
3. Where an agent is dealing with a property that has a rent the equivalent of 10,000 euros or more, they must register with HMRC for AML supervision.
4. The new directive also details that enhanced due diligence measure MUST include:
   1. Gaining additional information on the customer and on the customer’s beneficial owner.
   2. Securing additional information on the intended nature of the business relationship.
   3. Finding information on the source of funds and source of wealth of the customer and of the customer’s beneficial owner.
   4. Also, to obtain information on the reasons for the transactions.
5. This updated anti-money laundering directive is applicable across the entire UK.

ARLA supports agents with new resources

To help ensure letting agents are aware of the updated anti-money laundering regulations, understand what they are and also how to abide by them, ARLA is in the process of studying the new rules and creating relevant resources to support its members in compliance.

It’s also interesting to note that its not just letting agents who will have to comply with the updated regulations, art market participants and providers of exchange or storage services for crypto assets are also required to follow the rules.

This underscores that the UK Government is committed to supporting the EU’s work against money laundering activities across the broader European Union. For now, at least.