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16 JAN 2019

Surveying industry looks to RICS for guidance on anti-money laundering

Bribery, corruption, money laundering and terrorist financing are concerns that cut across the surveying profession regardless of geography or industry specialism.

To manage these risks, RICS is working on a professional statement that our professionals will be expected to adhere to once finalized. Currently in draft, we’re reaching out to stakeholders to ensure the professional statement is clear and effective.

Learn more about our professional statement on Countering Bribery and Corruption, Money Laundering and Terrorist Financing

In open pubic consultations, we received responses from the Financial Action Task Force, Transparency International, a number of international banks, firms, real estate brokers, and companies that use the standards. Some of their concerns were related to the administrative burden of new standards. The draft was amended to take this feedback into consideration.

In December 2018, we consulted further with industry stakeholders to get their thoughts on our work around anti-money laundering. Though we collected their input to make it public, we assured them we would not publicize their names, so they would feel comfortable providing genuine responses. Their input was encouraging.

One of the themes that stood out at the consultations has been the need for a broad program to support compliance. When the problem is tackled in one country, criminals shift their activities to other countries. Our aim at RICS is to build global cooperation on these issues to keep criminals from being able to shift their activities to new regions when one country tackles the issue.

Broad support, however, must include best practices that can be adopted by smaller players as well. It isn’t enough for large organizations to be on board, just as it isn’t enough for one country to enforce anti-money laundering regulations. The statement should provide a body of knowledge and toolkit for small companies that don’t have staff with expertise or experience on this topic.

The statement recommends security investments to prevent illegal activities, but it can be a challenge to justify spending on heightened security because financial loss due to corruption is difficult to pinpoint on the bottom line.

One way to get around this problem is to frame the issue as a reputational one, rather than a financial one. It takes 30 years to build a reputation, but 30 seconds to destroy it. Brands are willing to invest in security measures that will reduce reputational risk – and this is an area where anti-money laundering efforts will pay off.

In the Americas, there has been broad support for efforts to build standards to tackle the issue of bribery, corruption, money laundering and terrorist financing and, as a global professional body, RICS is being recognized as the right organization to oversee them.

Consultations will continue until the final version of the statement is ready. Once that is released, we will work with professionals over six months to ensure they are aware of the standards and are ready to comply with them before they go into effect.