There has been an upward shift in the number of agents now charging clients to carry out Anti-Money Laundering (AML) checks, according to new data from Smart Compliance.
The company says that 52% of their partnered agents charge both buyers and sellers, while 55% charge only purchasers.
Like any other business process, AML compliance comes with its own set of costs, whether managed internally or outsourced to an AML specialist. These can include technology expenses, investment in staff training to remain up to date with regulations, and operational costs associated with hours spent chasing documents, carrying out checks, and reviewing compliance packs.
Given these costs, some agents feel it is OK to pass on this expense to clients, especially if it ensures an efficient and compliant property transaction.
Amy Shields, commercial director at Smart Compliance, said: “Agents can’t continue to cover every compliance cost. I view these expenses similarly to an EPC – it’s a legal requirement.
“Many agents we speak to are trying to cut or minimise costs related to their suppliers and ‘tech stack’ due to market changes. I love being able to help clients stay compliant without any additional business costs.”
For agents considering charging their clients for AML, Shield provides these tips:
Be Transparent & Informative: Confidently explain the reason behind the charge, emphasising AML compliance as a legal necessity. Provide straightforward explanations on your website and in your agency terms to ensure complete transparency with both sellers and buyers.
Outline Requirements Early On: It’s always good to set expectations at the beginning of a transaction. This can be done by detailing the AML requirements and charges at the start of the client relationship.
Include Information on All Marketing and Correspondence: From valuation documents to online property listings, make sure AML charges are thoroughly documented. Incorporate marketing materials in valuation packs and distribute them during viewings to inform about your company’s compliance procedures.
Informing and advising: Introducing a new charge can initially seem challenging. However, as agents have discovered, it often just a case of a change in mindset and, much like discussing fees, having confidence in your professional service. Agents’ experiences show that with the right approach, clients not only understand but also appreciate the necessity of paying for AML services. Discussing AML isn’t about selling; it’s about informing and advising.
