Key AML/CFT compliance takeaways for firms operating in the real estate sector.
05/06/2024
An October 2022 Decision Notice issued by the Financial Conduct Authority against Gatehouse Bank plc offers some key takeaways
Gatehouse Bank plc offered services which primarily focused on real estate, and several key AML/CFT compliance takeaways relevant for firms operating in the real estate sector came from the FCA Decision Notice as follows:-
- A robust Customer Due Diligence Program is fundamental to AML/CFT compliance.
- It's not just about identifying the customer, but also those with a 'beneficial interest' in the customer.
- Enhanced customer due diligence measures are necessary for transactions involving high-risk jurisdictions or individuals in the real estate sector, such as foreign politically exposed persons.
- Internal Controls and Resources:
- Internal Controls and Resources will ultimately depend on the size, nature and complexity of the firm and its services concerning real estate.
- The firm must ensure those controls are properly resourced. Depending on the type of criminal activity, firms should ensure their risk assessments adopt a combination of financial and criminal risk indicators to conduct further monitoring and identify if a suspicious activity report should be submitted to the FIU.
- Testing auditing and adequate record-keeping practices should also be noted.
- Day-to-day supervision plays a crucial role in AML/CFT compliance.
- The Gatehouse Bank plc case highlighted the importance of scrutinising customs transactions, particularly the source of wealth and funds.
- More than merely stating the requirements is required.
- Clear processes and practical examples are needed to guide front-of-house personnel and other stakeholders in implementing an effective AML/CFT program.
SOURCE
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As well as owning and publishing Comsure's copyrighted works, Comsure wishes to use the copyright-protected works of others. To do so, Comsure is applying for exemptions in the UK copyright law. There are certain very specific situations where Comsure is permitted to do so without seeking permission from the owner. These exemptions are in the copyright sections of the Copyright, Designs and Patents Act 1988 (as amended)[www.gov.UK/government/publications/copyright-acts-and-related-laws]. Many situations allow for Comsure to apply for exemptions. These include 1] Non-commercial research and private study, 2] Criticism, review and reporting of current events, 3] the copying of works in any medium as long as the use is to illustrate a point. 4] no posting is for commercial purposes [payment]. (for a full list of exemptions, please read here www.gov.uk/guidance/exceptions-to-copyright]. Concerning the exceptions, Comsure will acknowledge the work of the source author by providing a link to the source material. Comsure claims no ownership of non-Comsure content. The non-Comsure articles posted on the Comsure website are deemed important, relevant, and newsworthy to a Comsure audience (e.g. regulated financial services and professional firms [DNFSBs]). Comsure does not wish to take any credit for the publication, and the publication can be read in full in its original form if you click the articles link that always accompanies the news item. Also, Comsure does not seek any payment for highlighting these important articles. If you want any article removed, Comsure will automatically do so on a reasonable request if you email info@comsuregroup.com.