The majority of UK estate agents may now face a heightened risk of breaching anti-money-laundering (AML) regulations following major changes introduced by HMRC last month, according to compliance technology specialist Coadjute.
On 9 September, HMRC published revised AML guidance that significantly redefines what is mandatory. The word “must” appears 212 times in the document, effectively converting numerous previously advisory checks into legal obligations.
The update also introduces a checklist of 34 named risk indicators that must be incorporated into every agency’s Business Risk Assessment (BRA) and Policies, Controls, and Procedures (PCPs). Agencies that have not updated their documentation and onboarding processes since 9 September are likely non-compliant and could face fines of up to £158,000, based on recent HMRC enforcement cases.
Coadjute’s chief operating officer, John Reynolds, author of Digital Bricks and Mortar and a long-time advocate for higher digital standards in property, said he is speaking out now because the implications of the new rules are only just being understood.
“In recent weeks we’ve seen growing confusion across the industry,” said Reynolds.
“Agents are receiving audit requests and warning notices, and many are realising their existing AML files and policies simply don’t meet the new benchmark.
“If you’re still doing what you’ve always done, you may now be breaking the law.”
HMRC’s framework explicitly names red-flag patterns including super-prime price anomalies, SPVs, offshore entities, intermediaries, remote onboarding and third-party payers. The regulator has also clarified that most commonly used digital ID tools and sanctions look-ups alone are not sufficient to meet AML obligations.
“Tick-box apps and partial checks don’t cut it anymore,” Reynolds added. “Agents must be able to evidence how each transaction was reviewed against the 34 risks, what was found and what Enhanced Due Diligence was done.”
With HMRC already “naming and shaming” non-compliant firms – and the FCA expected to assume AML supervision in future – Coadjute is urging agents to professionalise or outsource their AML processes to avoid reputational and financial damage.
“Just as agents outsource payroll or EPCs, AML now needs specialist handling,” Reynolds said. “The new rules make ad-hoc compliance impossible to defend. Getting it right protects not just your licence but your brand.”
