Lawyers attack ‘excessive’ AML controls ‘choking’ conveyancing
The Property Lawyers Alliance says Ministers who criticise the slow conveyancing process could help by lessening the huge amoung of AML red tape complicating home buying and selling.
A group of lawyers working in conveyancing has made an unprecedented attack on the AML regulations which they claim are ‘choking’ the homebuying process with red tape, slowing it down and putting a ‘crippling’ bureaucratic and financial burden on many conveyancing firms.
These comments come from the Property Lawyers Alliance (PLA), which has launched a campaign that it hopes will persuade the Government to act, particularly given’s Labour’s desire to speed up the home buying process.
“Solicitors are among the most highly qualified individuals in homebuying but are shackled to a bureaucratic AML regime that undermines their business, their transactions and their clients’ trust in them,” says Chair and organisation founder Stephen Larcombe (main image).
“And all the while, they are scapegoats for delays in the home-buying process.”
The PLA says the ‘mountain of homebuying red tape’ which it estimates to run to 1,500 pages of AML laws, guidance notes, sanctions lists and regulations including three pieces of legislation, have become a ‘crippling burden’ to those helping people buy and sell properties.
It is also claimed that the responsibilities of sticking to AML regulations is pushing many firms to the brink of collapse.
Huge fines
The PLA also points to the huge fines meted out recently by the Solicitors Regulation Authority (SRA) of up to £120,000, plus the variable levels of ‘effective supervision’ by the different organisations tasked with providing professional body supervision, and the additional costs of getting AML audited.
The AML regime has reached the point where it is choking conveyancing.
But the main thrust of the PLA’s outcry is that AML controls have become excessive, saying that: “The AML regime has reached the point where it is choking conveyancing. Since the early days of just needing to verify a party’s identity, requirements have snowballed, way beyond all reasonable measures,” it says.
The organisation also says anger within the industry is growing over the situation, particularly as Government ministers continue to be critical of the slow conveyancing process.
“When excessive, government-imposed AML and sanctions obligations are at the root of so much of the delays experienced in conveyancing, it is little wonder that property lawyers across the country are angry,” the PLA says.
“They receive little recognition for the AML Controls they must implement, only criticism and blame.”
It also says those buying and selling homes are becoming increasingly unhappy with the ‘intrusive’ questions they face during the AML verification process and are made to ‘feel like criminals’.
“Moreover, because regulators are forcing lawyers to be de facto forensic accountants, some lose business because they must turn clients away if they cannot verify all sources of funds/wealth,” it adds.
Can’t say electronic checks are really an issue or delays matters. Some clients may be opposed to it but once explained to them the reasons, the vast majority are happy to comply. We have a different policy for those clients who are not able have their ID checked electronically so we encounters vary few problems.
Estate agents are in agreement with all the above, the delays the checks cause plus the ‘intrusive’ questions and sometimes losing business over the checks, but we can’t charge for our time doing the AML checks so are even further out of pocket !