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AML checks attributed to foreign buyers hits all-time low

Data from the anti-money laundering checks provider had previously revealed that these checks had hit a record high during the first quarter of this year.

Robyn Hall

Faces illustrating ID checks

Anti-money laundering checks on foreign buyers has hit an all time low with non-British applicants accounting for just 36% of all checks carried out in 2021, research from Credas Technologies has revealed.

Data from the anti-money laundering checks provider had previously revealed that these checks had hit a record high during the first quarter of this year. But their latest data shows how the balance of domestic and foreign buyers has changed, with foreign buyers accounting for just 38% of all AML checks between January and May.

Tim Barnett, chief executive of Credas Technologies, said, “The proportion of AML compliance checks attributed to non-British applicants hit a record low in 2021, but the latest data suggest that this trend could be starting to reverse in 2022.

“Of course, a combination of Brexit and the more recent pandemic travel restrictions will have stifled market activity from foreign nationals. However, this decline is down to an overall increased level of AML compliance rather than a decline in foreign demand per se.”

Since 2018, the number of AML checks performed on foreign nationals has increased by nearly 3,200%. But at the same time, checks performed on domestic buyers have also climbed by over 7,550%.

Since 2018, the number of AML checks performed on foreign nationals has increased by nearly 3,200%.”

Barnett added, “This suggests that where international buyers were previously a far greater focus for the industry when it came to ensuring AML compliance, we’ve since started to take a more all encompassing approach. While the data shows that non-British applicants are far more likely to be flagged when checked, it’s reassuring to see that these checks are being carried out across the board.

Technological advancements

“This is undoubtedly a result of advancements in AML technology and today, we’ve streamlined this process to less than a minute. In doing so, we’ve enabled the industry to be as diligent when it comes to domestic AML compliance as they have been traditionally with those from outside of Britain.”

In 2021, just 36% of all AML checks performed were on foreign buyers. This is by far the lowest proportion since 2018 when Credas’s records began.

Decline

In 2018, foreign buyers accounted for 56% of all AML checks, falling to 53% in 2019 and again to 50% in 2020.

At the same time, the number of foreign buyers being approved during the AML compliance process has also declined. Last year, non-British applicants accounted for 35% of all those being approved, down from 50% the previous year (2020) and 54% the two years prior to that.

While foreign buyers accounted for 62% of all applicants to have been flagged for AML compliance issues in 2021, this too was the lowest proportion of all flagged applicants seen since 2018.

June 16, 2022

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