What you should do if you or someone in your business notices something suspicious through working in property.
Property professionals need to be aware of their obligations to report financial crime under the Money laundering Regulations 2007, the Proceeds of Crime Act 2002, and the Terrorism Act 2000.
Money Laundering Regulations 2007
The UK Money Laundering Regulations 2007 apply to anybody who is in the “Regulated sector”, which covers professionals considered to be at the high risk of being used by criminals to launder money. Estate agents are included in this sector although managing agents and letting agents are not.
Regulated firms are required to put systems in place to avoid money laundering and to report suspicious activity and are required to report suspicion of money laundering as soon as possible to the National Crime Agency (NCA) (previously the Serious Organised Crime Agency), regardless of whether they proceed with the transaction.
Firms that are not within the regulated sector may also be required to submit a Suspicious Activity Report (SAR). You may commit an offence if you have knowledge or suspicion of money laundering activity or criminal property, assist anyone in dealing with it and then fail to make a SAR. Submitting a SAR provides a defence against committing a money laundering offence.
Proceeds of Crime Act 2002 (POCA)
POCA outlaws all types of money laundering with additional offences in relation to failure to report suspicion of money laundering. Professionals in the regulated sector are required by POCA to submit a SAR as soon as possible, if they know, suspect or have reasonable grounds to know or suspect that a person is engaged in , or attempting, money laundering or terrorist financing.
All members of RICS are expected to have reasonable knowledge under the provisions of this Act.
Money laundering offences under POCA include;
- Concealing, disguising, converting, transferring criminal property (which the person knows / suspects represents the proceeds of crime)
- becoming involved in an arrangement (which he/she knows/suspects) relates to criminal property
- acquisition, use or possession of criminal property
- disclosing or “Tipping off” that a SAR has been made.
In addition, under the Terrorism Act 2000 all individuals and companies must report terrorist financing where they know or suspect it is taking place.
Submitting a SAR
Information on how to make a SAR is available from www.nationalcrimeagency.org.uk where you will find information on making SARs and information on how to complete the form.
Once you have made the report, you should keep the number of people that you tell about it to a minimum. You must not inform the person about whom the SAR has been made, as this will constitute 'tipping off' - an offence under the POCA.
SARs Review and Feedback – Estate Agents
The NCA has published a report for the estate agency sector to raise awareness of the kinds of trends and issues identified from SARs submitted over the past year.
RICS members can download the document below, along with the NCA’s twice yearly report which is produced by the NCA’s United Kingdom Financial Intelligence Unit.
Reporting to RICS
If you know or suspect a person is engaged in suspicious activity you can call the confidential regulation helpline 020 7334 3867 or alternatively you can email information to firstname.lastname@example.org.
If you have knowledge or suspicion of an acquisitive or fraud related crime, including confirmed fraud, attempted fraud or where information relating to fraud can be provided, reports should be made to Action Fraud, via www.actionfraud.police.uk or telephone 0300 123 2040.
Regardless of whether or not a crime has been reported, you will wish to consider your obligations under POCA. If you have knowledge or suspicion that a money laundering offence has taken place, then you must submit a SAR to the NCA.
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