Estate agents lead the charge against criminal activity with highest annual increase in AML registrations

Research by Credas Technologies, the leading identity verification service, has shown that UK estate agents are leading the charge against criminal activity with the largest annual increase in the number of newly AML registered businesses.

Having been a legal requirement since 2018, it’s estimated that HMRC saw over 34,000 new businesses register over the last year – up 40% annually. 

However, it’s the nation’s estate agents who are leading the charge where AML cover and compliance is concerned and for good reason. 

The property market has long been a target for criminal activity and money laundering in particular. In fact, the government’s latest risk assessment of money laundering and terrorist financing increased the risk score for money laundering within the UK property market to high, with the specific risk to both estate and letting agents also increasing. 

Despite this risk, HMRC revealed that estate agents had been slow out the blocks when it came to AML compliance, estimating back in 2019 that just half of all estate agents had registered with them for AML supervision. 

However, the latest data suggests they have started to get their house in order. Not only did estate agency businesses account for 38% of all annual AML registrations, but this number also climbed by 64% on the previous year. 

This was the highest annual increase of all sectors followed by IT and digital payment service providers (+38%) and accountancy service providers (+38%), with the latter also the only sector to account for a higher proportion of total registrations (49%). 

This uplift in AML activity has continued in 2022, with the number of individuals being processed for AML checks with Credas in January 2022 up by 25.7% on 2021, with February currently tracking for a similar level of increase when compared with the same month last year. 

Tim Barnett, CEO of Credas Technologies says:

“The UK property market has been a key target for criminal activity for far too long and so it’s great to see that the nation’s estate agents are leading from the front in the fight against this criminality. 

Historically the industry has suffered from a lack of AML regulations and the failure to share information across all professional parties involved in a transaction has further hampered attempts to identify illegal activity. 

We’ve also seen insufficient levels of checks being carried out on buyers, particularly those from overseas, and this has stemmed from an over reliance on ID checking software that is either unfit for purpose, or not fully understood by those using it.

However, we’re now seeing record numbers of estate agents seeking the help of our services and this includes the smaller independent agents as much as it does the industry’s largest operators.

This suggests that the industry has now woken up to the threat we face and that AML compliance is no longer a box ticking exercise to satisfy HMRC.”

Data Tables (Image format)

Data sourced from HMRC Anti-Money Laundering Supervision annual assessment (2019 to 2020 – latest available)