Estate agent charging buyer for ID check

Taiko

Found this example while I was browsing in Portsmouth. Haven't seen any other EA's with this https://www.rightmove.co.uk/properties/122016740#/?channel=RES_BUY

canaldumidi

I gotmy solicitor todo the checks (he has to anyway) and then email the EA tosay I'm me and I'm good for the money.

Included in my basic conveyancing fee,

GDB2222

The Government advice is here:
https://www.gov.uk/government/publications/money-laundering-regulations-2007-supervision-of-estate-agency-businesses/estate-agency-guidance-for-money-laundering-supervision#money-laundering-and-estate-agency-businesses

I didn't see a requirement to AML people who make offers. 

Flugelhorn

GDB2222 said:

The Government advice is here:
https://www.gov.uk/government/publications/money-laundering-regulations-2007-supervision-of-estate-agency-businesses/estate-agency-guidance-for-money-laundering-supervision#money-laundering-and-estate-agency-businesses

I didn't see a requirement to AML people who make offers. 

I had over fussy agent who wouldn't accept my online printed statement for the NS&I saying it wasn't a proper statement. Solicitor (and 2 later estate agents) were perfectly happy it - admittedly fusspot was pre-pandemic (just) and the worls had changed since then. 
Silly woman  - told her to ask someone with more experience and if she didn't want to do that / accept the evidence of funds we would withdraw the offer and write to the vendor explaining why.

eddddy

GDB2222 said:

The Government advice is here:
https://www.gov.uk/government/publications/money-laundering-regulations-2007-supervision-of-estate-agency-businesses/estate-agency-guidance-for-money-laundering-supervision#money-laundering-and-estate-agency-businesses

I didn't see a requirement to AML people who make offers. 

The relevant legislation to look at is: 

• Estate Agents (Undesirable Practices) (No 2) Order 1991
• The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017

The Estate Agents (Undesirable Practices) (No 2) Order 1991 says that EAs must forward offers to sellers (which is good) :

SCHEDULE 3
Other Matters

2.  The failure by an estate agent to forward to his client promptly and in writing accurate details (other than those of a description which the client has indicated in writing he does not wish to receive) of any offer the estate agent has received from a prospective purchaser in respect of an interest in the land.

But then, The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 SCHEDULE 7 PART 2 Paragraph 12 seems to add that the EA doesn't have to forward the offer, if the EA is unable to do due diligence on the offeror:

Estate Agents (Undesirable Practices) (No 2) Order 1991

12.  Schedule 3 (other matters) to the Estate Agents (Undesirable Practices) (No 2) Order 1991(1) is amended as follows—

(a) at the beginning of paragraph 2, insert “Subject to paragraph 2A”;

(b) after paragraph 2, insert—

“2A.  Paragraph 2 does not apply if the estate agent does not forward accurate details of the offer because the estate agent is unable to apply the customer due diligence measures required by regulation 28, and where relevant, those required by regulations 33, and 35 to 37 of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 in relation to the offeror.”.

Do you agree with that interpretation?

Links:

https://www.legislation.gov.uk/uksi/1991/1032/made

https://www.legislation.gov.uk/uksi/2017/692/schedule/7/paragraph/12/made

Flugelhorn

Taiko said:

Found this example while I was browsing in Portsmouth. Haven't seen any other EA's with this https://www.rightmove.co.uk/properties/122016740#/?channel=RES_BUY

Includes "mover protection" - is that some sort of insurance ?

jimbog

Taiko said:

Found this example while I was browsing in Portsmouth. Haven't seen any other EA's with this https://www.rightmove.co.uk/properties/122016740#/?channel=RES_BUY

'Successful buyers will be required to complete online identity checks provided by Lifetime Legal. The cost of these checks is £60 inc. VAT per purchase which is paid in advance, directly to Lifetime Legal. This charge verifies your identity in line with our obligations as agreed with HMRC and includes mover protection'

Not sure how a buyer is deemed 'successful' until the end of the transaction and yet it's paid in advance

GDB2222

eddddy said:

GDB2222 said:

The Government advice is here:
https://www.gov.uk/government/publications/money-laundering-regulations-2007-supervision-of-estate-agency-businesses/estate-agency-guidance-for-money-laundering-supervision#money-laundering-and-estate-agency-businesses

I didn't see a requirement to AML people who make offers. 

The relevant legislation to look at is: 

• Estate Agents (Undesirable Practices) (No 2) Order 1991
• The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017

The Estate Agents (Undesirable Practices) (No 2) Order 1991 says that EAs must forward offers to sellers (which is good) :

SCHEDULE 3
Other Matters

2.  The failure by an estate agent to forward to his client promptly and in writing accurate details (other than those of a description which the client has indicated in writing he does not wish to receive) of any offer the estate agent has received from a prospective purchaser in respect of an interest in the land.

But then, The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 SCHEDULE 7 PART 2 Paragraph 12 seems to add that the EA doesn't have to forward the offer, if the EA is unable to do due diligence on the offeror:

Estate Agents (Undesirable Practices) (No 2) Order 1991

12.  Schedule 3 (other matters) to the Estate Agents (Undesirable Practices) (No 2) Order 1991(1) is amended as follows—

(a) at the beginning of paragraph 2, insert “Subject to paragraph 2A”;

(b) after paragraph 2, insert—

“2A.  Paragraph 2 does not apply if the estate agent does not forward accurate details of the offer because the estate agent is unable to apply the customer due diligence measures required by regulation 28, and where relevant, those required by regulations 33, and 35 to 37 of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 in relation to the offeror.”.

Do you agree with that interpretation?

Links:

https://www.legislation.gov.uk/uksi/1991/1032/made

https://www.legislation.gov.uk/uksi/2017/692/schedule/7/paragraph/12/made

I’m not entirely sure that I do follow that.  Customer due diligence measures sounds to me like it would refer to the estate agent's own customers, ie the sellers of the property.  

The government guidelines do, however, include this:

• complete customer due diligence on all customers and beneficial owners before entering into a business relationship or occasional transaction
• complete due diligence on the counterparty and any beneficial owners, involved in the property sale

I assume that the buyers are the counterparty referred to? 

Anyway, this thread has been very useful, as I won’t be surprised if an estate agent insists on seeing my passport etc.

eddddy

GDB2222 said:

I’m not entirely sure that I do follow that.  Customer due diligence measures sounds to me like it would refer to the estate agent's own customers, ie the sellers of the property.  

I don't think so, for 2 reasons.

1) What about the bit I highlighted in bold? It says "in relation to the offeror". 

What do you understand by the phrase "in relation to the offeror" in that context?


2) The law is much clearer once an offer has been accepted:

The Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations say:

Meaning of a business relationship

(3) For the purposes of these Regulations, an estate agent is to be treated as entering into a business relationship with a purchaser (as well as with a seller), at the point when the purchaser’s offer is accepted by the seller.

Bodds

Talk to the person who is handling the legal side of the purchase for you. I think they may well have a view.