HMRC crackdown on estate agents over money laundering failures

Estate agents have been hit with unannounced inspections as part of a week-long crackdown on money laundering in the property industry, while national chain Countrywide has been fined a record £215,000 for breaches of the regulations, HMRC has revealed

HMRC officers visited 50 estate agents across England after they were suspected of trading without being registered as required under money laundering regulations.

The visits came as HMRC published the list of businesses given penalties for failure to comply with the 2007 money laundering regulations for the period 1 August 2018 and 31 October 2018.

This included Countrywide Estate Agents, which received a £215,000 fine for failing to ensure policies, controls and procedures at group level, and for failures in conducting due diligence; timing of verification and proper record keeping.

HMRC says it will now take action against the visited businesses who have failed to comply, which can include fines, publication and criminal proceedings.

John Glen, economic secretary to the Treasury, said: ‘The vast majority of estate agents play by the rules and help us to crack down on dirty money. But I have zero tolerance for firms prepared to turn a blind eye to the law.’

Simon York, director of HMRC’s fraud investigation service, said: ‘Estate agents need to understand that criminals prey on weaknesses, so it’s vital they take all steps to protect themselves. The money laundering regulations are key to that, but there’s still a minority of agents who ignore their legal obligations. These inspections are a wake-up call that if you continue to trade illegally we will come knocking.’

This is the first such week of action involving intelligence-led, co-ordinated activity aimed at estate agents trading without registering with HMRC as legally required.

The visits involved HMRC inspectors questioning the businesses to establish whether they were trading in breach of the regulations. Inspectors then assess whether any further action is required.

HMRC supervises more than 11,000 residential and commercial estate agents across the UK, and has produced webinars, guidance and e-learning on their money laundering responsibilities.

Over the past three years, HMRC has carried out more than 5,000 interventions on supervised businesses in all sectors, with 655 penalties worth £2.3m issued in 2017 to 2018. In addition, HMRC recovered over £31m under the Proceeds of Crime Act.

List of businesses for tax year 2018 to 2019 that have not complied with the 2017 money laundering regulations is here.

Help and support for money laundering supervision is here.

Accountancy Daily