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Watch out for money laundering surge during Coronavirus, RICS warns estate agents

Institution says the financial chaos and business uncertainty created by the pandemic will lead to more attempts to circumvent AML and other rules.

Nigel Lewis

money laundering

Estate agents face an increase in money laundering and terrorist finance activities within the property market during the Coronavirus crisis, the Royal Institution of Chartered Surveyors (RICS) has warned.

The organisation has issued a guidance document to alert firms that they made face extra anti-money laundering (AML) and corruption risks at this time, and to help them maintain appropriate controls.

“In particular, firms should consider whether the current economic climate may make them or their customers more susceptible to financial difficulties or other pressures, thus creating risk and potential weaknesses for criminals to exploit,” the document says.

This includes being put under pressure to ignore or circumvent due- diligence checks in order to speed up transactions, being offered bribes, greater exposure to mortgage fraud and criminals using their ill-gotten gains to buy property.

Agents are also warned to keep an eye on their lettings activities too including tenants trying to sell properties they do not own and landlords leaning on agents to circumvent regulations and in particular property licensing schemes.

RICS says estate agents should be particularly careful about the risks of cybercrime as more communication with clients and within firms is done digitally during the crisis, and to be wary of intercepted emails and criminals posing as solicitors.

Christine O’Rourke, Head of Conduct Standards at RICS, says: “Last year, we set mandatory professional standards following our work with the UK Government and Transparency International to reduce the risk for the UK property market and increase market confidence.

“When money laundering is estimated to account for up to 5% of global GDP, our updated guidance supports RICS professionals to uphold their standards through COVID-19 challenges as they adapt to the new business and economic climate.”

Read the RICS guidance. 

 

May 26, 2020

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