Question to the HM Treasury:

To ask Her Majesty's Government what assessment they have made of the effectiveness of anti-money laundering regulations in the domestic and corporate property sector.

The Money Laundering Regulations 2017 (MLRs) require regulated businesses, including estate and lettings agents, to have robust controls in place to prevent abuse for the purposes of money laundering or terrorist financing. The MLRs are not prescriptive in setting out how firms should carry out customer due diligence. However they do require these firms, which are key facilitators of property transactions, to take a proportionate and risk based approach to checks on all involved parties.

HMRC is the designated AML supervisor for estate and letting agents. HMRC provides guidance to businesses to support compliance and has powers to enforce penalties in response to breaches of the MLRs, including imposing fines.

HM Treasury published a review of the UK’s anti-money laundering/countering-terrorist financing (AML/CTF) regulatory and supervisory regime in June 2022. This review assessed the effectiveness of the MLRs and found that the regulations are comprehensive, robust and allow for firms to take a risk-based approach to target their activity at the areas of highest risk. It also set out plans for future work to strengthen the UK’s AML regime, including a consultation on further reform to the supervisory regime.