By Legal Futures Associate Lawtech Software Group
It is essential estate agents have effective due diligence procedures in place to deal with particular challenges that arise during the transaction process. Estate agents like lawyers, solicitors and conveyancers must complete due diligence on potential clients, individuals and businesses to ensure they protect their business from potential harm and tackle fraud. Enhancing AML due diligence within estate agents is a necessity to ensure compliance within the regulatory guidelines.
However, while lawyers are governed by authority figures like the Solicitors Regulation Authority (SRA) and the Law Society of Scotland (LSS), estate agents are governed by His Majesty’s Revenue & Customs (HMRC). HMRC has set out a comprehensive guide that estate agents must follow to ensure compliance with their guidelines, and these measures ultimately aid an estate agent’s challenge to complete due diligence.
This feature will analyse why it is so crucial for estate agents to complete due diligence and the role Verify 365 can play in helping estate agents streamline their onboarding processes and complete the necessary due diligence checks.
Enhancing AML due diligence for estate agents: The challenges
There are different tiers of due diligence. There are numerous challenges estate agents face when attempting to complete due diligence, which can be problematic, including:
Verifying Your Client’s Identity – Confirming your client’s identity can pose challenges during the due diligence processes, particularly if they don’t present the right information or, indeed, false documents. This will make the due diligence processes much more complicated and longer to complete.
Identifying Beneficial Owners — One of the main challenges is identifying the beneficial owner, whether that be a property or business. These checks can be time-consuming, and manual processing may make the identification process even longer than necessary. Similarly to verifying an individual’s identity, a lack of information or false information can further complicate the process.
Understanding and Confirming Source of Funds – Another significant challenge with the due diligence process is confirming the source of funds and wealth. A manual process can be time-consuming, as well as collating and collecting all the necessary financial documents like bank statements. In addition, identifying the source of funds is essential to protect your business, mitigating risk and preventing fraud and any anomalies in the data, which could also present significant issues.
Transaction Risks – If the transaction itself flags up signs, this could also affect the due diligence process. If the transaction isn’t on course to go through and deters in some way, it could be a sign of potential money laundering. Other potential transaction risks include the number of parties involved if the seller attempts to mislead in terms of value and or if the property price is unusually high or low.
Understanding Complex Legal Frameworks – With HMRC overseeing estate agents in the UK, understanding this framework may also pose challenges, given its complexities and the key areas estate agents must cover. Estate agents must implement a strategic, effective compliance plan that ensures they are working with the regulatory guidelines and can complete due diligence effectively.
There are plenty of challenges, but with these challenges comes that estate agents can implement to deal with these challenges viable solution head-on, including innovative technology; Verify 365 is one of those changing the landscape not just for the legal sector but for estate agents.
Verify 365’s role in helping estate agents complete due diligence
Verify 365 provides a comprehensive solution for estate agents attempting to complete client due diligence. Our innovative AML & KYC client onboarding platform ensures you can identify your client and ensure due diligence is being completed effectively.
Using our DynamicID biometric technology built within the Verify 365 platform, you can run comprehensive identity checks. Our technology uses facial recognition and liveness scanning to verify your client’s identity, which is done within a few minutes. In addition to this, with our advanced screening and access to over 1,400 PEPs and sanctions lists, you can confirm an individual’s current status. Our comprehensive reports will detail whether an individual is politically exposed, sanctioned or facing adverse media. Continuous monitoring over a 12-month period ensures you can fully mitigate risk, protect your agency from harm and be notified of any changes in an individual or business’s status.
Furthermore, also available to you via our innovative, evolving Verify 365 platform is the ability to analyse financial data and decipher the source of funds from both individual clients and businesses. Using our open banking technology linked with advanced AI analytics, you can connect with over 4,000 banks worldwide to analyse financial data and confirm both the source of funds and the source of wealth. By doing this, you can also identify any financial anomalies that could be a cause for concern thereby protecting your agency.
Enhance due diligence with Verify 365’s comprehensive KYB checks
Through Verify 365, you are also able to complete comprehensive KYB checks. Confirm the ownership structure of the business and the ultimate beneficial owner (UBO), and any other directors within the hierarchy. Connect with global banks to analyse financial data to ensure all movements are legitimate, as well as gain an overall picture of the financial position of the business or company. Our instant, global address verifications mean you can confirm the physical location and legal status of a business, another crucial component of the KYB checking process.
Our proprietary technology ensures you are fully up to date with any regulation changes made by HMRC. We’ll make sure you can streamline your processes, intelligence, and practice compliance while enhancing due diligence according to regulatory guidelines. It’s vitally essential that estate agents are aware of the importance of having effective procedures in place while also maintaining the highest of standards when completing due diligence.
Verify 365 is changing the legal and property landscape, ensuring estate agents can complete all the checks they need during the due diligence process while also helping them streamline. We know estate agents are keen on maintaining top standards regarding due diligence and AML compliance and using our innovative client onboarding platform will ensure you do just that.
